The US$ and French Elections

Posted April 22, 2017 at:

Trader Scott

The French elections are this weekend, with the second round in two weeks. Currencies, especially the Euro hence the $, will be “news markets”, and other markets will get dragged around with it. But no matter what the outcome is, the overall downtrend in the Euro will remain. In the short-intermediate time frame, the Euro is in the middle of its bigger range, and daytrading focus aside, it’s a lousy place to put on a position. I have no position in the Euro, I’m still long the $, but am aware that the election weirdness could send these markets back to the 3/27 extremes. None of the pressures on the $ have abated – there is still a large USD short position, the Euro bank problems are festering, and the election will solve nothing. I could be completely wrong about my bullishness on the $, and maybe therecent103.82 was the major top. However I am still very bullish on the $ and do expect a much more emotional top like what occurred in the 2000 time frame. Those emotions 17 years ago were about as extreme as it gets, and the emotional distribution process lasted for years. The emotions and the bullishness were getting ridiculous last December, and I pointed it out several times, well in advance. And there were some extreme sentiments, but they were over a couple of months, not on and off for years. This correction in the $ was well-telegraphed, but the clowns were still wasted on the bullish fumes from the election and were buying the USD right at the highs, because they were confident. Most of those clowns have shut up/been stopped out, and the sentiment is more sane now. As to the situation in France currently, the same type of crowd is pulling the same manure as they did before the election in the US. So while the globalists, elitists mantra before the US election was, “Anyone But DJT”, in France now it’s, “Anyone But MLP”.