The euro finds support as sentiment plummets

No need to wait for the European Central Bank announcement on Thursday, says John C Burford. Elliott wave theory tells you all you need to know.

I was away last week and since I last wrote, markets have given us some impressive moves, proving that a week is a long time in finance and sometimes, conditions can change even in one day. In fact, last Thursday was just such an occasion when it was all-change in the currency markets with the US dollar suddenly reversing its bull run.

In my last poston the euro on 26 February, I flagged this dollar decline as a high probability event.

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(Contracts of EUR 125,000)Row 0 - Cell 1 Row 0 - Cell 2 Row 0 - Cell 3 Open interest: 503,904
Commitments
105,765165,93257,339291,418212,752454,522436,02349,38367,882
Changes from 02/23/16 (Change in open interest: 6,180)
-3,44520,7045,1007,472-27,6969,126-1,892-2,9468,072
Percent of open in terest for each category of traders
21.032.911.457.842.290.286.59.813.5
Number of traders in each category (Total traders: 241)
6596695760159188Row 8 - Cell 7 Row 8 - Cell 8
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John is is a British-born lapsed PhD physicist, who previously worked for Nasa on the Mars exploration team. He is a former commodity trading advisor with the US Commodities Futures Trading Commission, and worked in a boutique futures house in California in the 1980s.

 

He was a partner in one of the first futures newsletter advisory services, based in Washington DC, specialising in pork bellies and currencies. John is primarily a chart-reading trader, having cut his trading teeth in the days before PCs.

 

As well as his work in the financial world, he has launched, run and sold several 'real' businesses producing 'real' products.