EURUSD--Monday, January 11, 2010
Eurusd rally faded at the 1.272 level (that is, 1.272 times the distance from the previous high on 1/5 to the low on Friday).
Almost certainly this is a temporary set back for a move to at least 1.46.
The risk trade or carry trade or whatever other appelation you want to put on this mindset is back on. The spectre of early CB tightening has receded with Friday's bad job number. Yet there seems something unconvincing about this return to risk. Like someone who has begun to sober up but then changed his mind and started drinking again. Unfortunately what usually follows is not a return to euphoria but a rather bad headache.