EUR facing an uphill battle

EUR/USD moved in favour of this trade yet again as positioning ahead of this week’s ECB meeting ramps up.

Source: Bloomberg

The pair declined significantly and even ventured below the $1.1500 handle in Friday’s trade, printing a low of $1.1460 (weakest since November 2003). EUR/USD has since recovered to $1.1553 but momentum is firmly to the downside and traders will be looking to sell the pair into strength. Last week, I trailed the stop on this trade to $1.1760, which left the trade in a profitable position. I am now looking to trail the stop on the trade even lower to $1.1630, which is where the November 2005 low is. I feel headline risk will ramp up out of Europe this week, given we also have Greek elections on January 25. As a result, I’d rather keep stops tight to avoid being caught out by any reversals.


Click to enlarge

This information has been prepared by IG, a trading name of IG Markets Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients. See full non-independent research disclaimer and quarterly summary.

Find articles by analysts

Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 79% of retail investor accounts lose money when trading spread bets and CFDs with this provider. You should consider whether you understand how spread bets and CFDs work, and whether you can afford to take the high risk of losing your money. Spread bets and CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.