They’re buying because they need them. Hedge funds are scrambling to cover shorts taken in anticipation of the end of the world, or at least the end of Europe. Unfortunate for them, the sun keeps rising, day after day…The break of 1.3700 accelerated the short-covering barrage and prices spiked through 1.3800 before the feeding frenzy subsided.
The hedge funds losses are my gains, as large cap equities rally nicely as risk aversion ebbs. Thank goodness.
This morning’s break of 1.3700 signals a medium-term bottom is in place. Large buyers are seen now on dips to the 1.3690/1.3700 region. After a period of consolidation, bulls will target huge resistance at 1.3925.
