Just getting the overnight rundown from some friends in the market and man were the central banks busy. They bought EUR/USD with both hands from 1.3350 on down to below 1.3300. Part of it was the typical diversification of reserves after intervention (Korea sold won overnight). Part looks to be the usual spec punting. So far, the market has been all too happy to give them all the euro they want.
Looks like there is a risk that specs are a bit too short of EUR/USD in the near-term and may be vulnerable to a squeeze if we don’t move through 1.3260/70 support soon…
