DislikedI think you overanalyze the Euro situation a little. Euro has shown some weakness on less hawkish Trichet comments last week but since then EURUSD downfall is dominated by dollar strengh. Now this dollar strengh came as a retrace after prolonged dollar weakness and I think the trigger was the burst of commodity bubble caused by exchanges margin raise.Ignored
While I do agree with you in saying that US strength is a factor in the EUR/USD downfall, I can't help but maintain that the market's focus is on Greece right now, and that the uncertainty faced is creating strong movements in the pair. When the Die Spiegel article came out, this thing dropped down so sharply that I thought it was jealous of XAG and was looking to compete! I just get the feeling that sentiment is presently quite Euro-bearish.
QuoteDislikedI see what you mean but I think you're wrong here, bug. Flash news traders who could really move the market were well aware about the previous releases so they were expecting better numbers (better than 0.6%). Maybe the numbers came out not as good as they expected (0.9% or more)after sovereign GDP releases. Anyway, the move down has little to do with EUR, it's more of USD strength. But that's only my opinion.
I think what bug and I were getting at is that provided one was aware of the fact that France's and Germany's GDP's came out much better than expected, then seeing as they are the economic powerhouses of the EuroZone, it would be sensible to posit that the EZ GDP would beat previous expectations.
The average trader who looks at his newsfeed and sees that the EZ GDP beat expectations would then be tempted to jump in and long the pair, while proficient traders who were already expecting this, and were long in anticipation of it, will have their expectations fulfilled, and simply close out their positions. Average trader now blames the market as irrational and says it responds randomly to news, as his stop-loss is liquidated into by traders closing their positions. If only he knew...
Regards,
xXTrizzleXx