The euro will not be denied. It has broken 1.25, trading up to 1.2504 so far.
Stocks down= euro up
Stocks up= euro up today…
We seem to be seeing a liquidating market in EUR/USD and gold today, but the spark for the liquidation is unclear. Hedge funds have been blamed for much of the last 130-odd points to the topside, as if they are being forced from the market.
Not sure what is causing the stress but I am very reluctant to ascribe fundamental motives to what appears to be a liquidity-driven trade. Same for a breakdown in the equity/ EUR correlation. It broke down today, but It has been so strong for the much of the last two years, I’m reluctant to declare it dead until it reaches room temperature…
