At the Close. USD bounce.

19:45CET

A good technical USD rebound on the back of the earlier comments mentioned here that the USD was getting rather oversold vs the CHF. It has been the USD/CHF surge of around 100 pips what has caused the USD to gain vs the majors, sinking the GBP (EUR/GBP higher by around 100 pips today), and causing the EUR to retrace to current 1.3260 levels, where we should see some support coming in.

There were reports earlier in the day that CBs were buying the EUR around 1.3350, but I don't think that was credible enough. Because what is credible is what the charts show, and basically, the fact that the USD got oversold vs the EUR earlier in the day (and CHF), was more important than any market rumor.

Having said that, I don't like current levels for long USD as we've covered some good ground, but that doesn't mean I don't like the USD, but rather that one has to choose levels carefully in these volatile times. I would wait for a decent retracement and the go for it, ie, 1.3320 in EUR/USD and 0.9620 in USD/CHF, going for 40-50 pips each time.

Before calling it a day, let me give you the retail traders long/short ratio on majors. Thank you for reading this blog, brought to you by offshore broker investors-europe.com.

Dec 15, 2010 20:00 GMT+0100

   1. USD/CAD
      76.13% 23.87%
   2. USD/CHF
      75.77% 24.23%
   3. USD/JPY
      72.59% 27.41%
   4. XAU/USD
      70.57% 29.43%
   5. GBP/USD
      53.50% 46.50%
   6. EUR/USD
      48.64% 51.36%
   7. AUD/USD
      47.51% 52.49%

Posted via email from MT4