Now matter what the ultimate cause is, we can be sure that this coupling is working, thus making EURUSD pair a must-watch for any trader. Fortunately now we have two clear levels to watch for the short term prognosis:
Sunday, August 23, 2009
The new Carry Trade?
I couldn't avoid linking current coupling between SP500 and USD and the similar coupling between SP500 and JPY until 2006-7 which made Carry Trade so popular and we described earlier. At those moments large investors borrowed JPY due to its minimal interest rate to buy stocks, therefore rising prices. It was a great business except when the JPY dropped. I used to watch EURJPY and USDJPY specially AH to get valuable clues about next session's behavior at stocks markets . We might be having the same phenomenon now with the USD whose low interest rates are making it attractive for those purposes.
Now matter what the ultimate cause is, we can be sure that this coupling is working, thus making EURUSD pair a must-watch for any trader. Fortunately now we have two clear levels to watch for the short term prognosis:
Now matter what the ultimate cause is, we can be sure that this coupling is working, thus making EURUSD pair a must-watch for any trader. Fortunately now we have two clear levels to watch for the short term prognosis:
