# Euro soft - trading strong on recent news?



## LawryDowner (12 October 2012)

IFR Markets Analyst Adam Parry paints an excellent picture on the present trading psyche:

The most likely scenario is that Moody's junks Spain. That would start to see the Spanish bonds being pulled from sovereign benchmark indices, leading to some forced fund liquidation of paper. That will inevitably lead to some widening of Spanish spreads. The main trigger that will force Spanish PM Mariano Rajoy to go cap in hand to the ECB will be a sustained rise in Spanish yields. And we know, at current levels that is not the case. Any knee-jerk widening of Spanish yields - say back to the levels at the end of July - will almost certainly bring an end to the stand-off between the Spanish government and the ECB, activating the OMT and resulting in a deluge of bond buying.

I feel personally that the Euro is still seen as a good buy, what are your thoughts?


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## cogs (12 October 2012)

So you have taken some long positions? 

Care to share them?


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## LawryDowner (23 October 2012)

Hi Cogs,

I see on these forums that the strong USD bullish bias still exists both with many traders on the forums and some of the analysts. This bias is great for making confident predictions of when things will "turn" (i.e. knowing the future), but in reality the bias is just terrible for real trading results as many of these folks usually end up on the wrong side of the trend. 

Long from 1.24 and holding (EUR/USD)


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## Trembling Hand (23 October 2012)

Errrrr?  we are talking to a bot right?


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## LawryDowner (24 October 2012)

Flesh and bone personally! I do give that the euro's upside is widely seen as limited, given the unresolved
three-year-old debt crisis and mounting evidence that global growth is sputtering.


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