EURUSD - Take Profits and enter Short . Gold is at all-time high

Take you profits when you can. its been a beautiful run.
On Daily , H4 and H1 charts

Sell EURUSD

Entry : 1.1760
TP Exit : 1.1400
SL Exit : 1.1960

Reasons:

- GOLD(XAUUSD) is overbought ( correlated with EURUSD at around 60% )
- USDX is oversold
- US Markets ( Dow, NASDAQ, SP500 ) are starting to stall and move side ways and tends to be correlated with EURUSD at around 40%
- US coronavirus is raging higher
- King Dollar has been stripped of his clothes , i ask " what is a king without clothes in public" but never count out King Dollar.
- EURUSD & GBPUSD has taken full advantage of the Dollar weakness but how stable are those economies considering EU approved 2 Trillion Euros stimulus.

Comment:

Sell EURUSD

Entry Range : 1.1760 -- 1.1850 ( Top entry range adjusted to 1.1850)
TP Exit : 1.1400
SL Exit : 1.2160 ( adjusted to 1.2500 )
Duration: 1 to 8 Weeks ( until end of September 2020 )

GBPUSD & EURUSD are greatly benefitting from USD weakness across the board not because UK or EU Economy is doing OK.

Note: Most of the Central Banks hold USD in Reserve due to stability and Dollar funding mechanism , and when USD is cheap they tend to be Buyers of USD. So at what point does the Central banks of the world come in and start buying USD for their reserves security ?

US treasury Yields (2 , 5, 10 , 30 years ) are at their lowest in decades so with those rates and central banks see a good opportunity of buying Huge USD reserves amounts on the cheap at almost 0% interest rate and lending it out to their country financial institutions for a few years with huge returns for Central banks

Comment:

Be Careful on EURUSD

we still think we need a short (SELL) but if GOLD (XAUUSD) keeps rising and USDX index keeps falling then hold on until speculators are exhausted . Right now the FX Majors are run my speculators , if you look at the Institutional Banks forecasts ( 3, 6 , 12 and 24 months ) to their major clients , they are projecting EURUSD at 1.1400 by end of Sep 2020 , 1.15 by end of Dec 2020 and we head down towards 1.11 at the end of 2021 , So its rare for them to be wrong.

Entry Range : 1.1760 -- 1.1850 ( Top entry range adjusted to 1.1850)
TP Exit : 1.1400
SL Exit : 1.2160 ( adjusted to 1.2500 )
Duration: 1 to 8 Weeks ( until end of September 2020 )

Comment:

Please take precautions , the EURUSD & GBPUSD are currently being driven by 2 factors

1. USD weakness across the board due to the US FED
2. Brexit deal news

There is High chance that both EURUSD & GBPUSD might extend the overshoot rally to 1.2500 Area for EURUSD and 1.3600 Area for GBPUSD .

I would take a loss if we hit our SL at 1.2160 for EURUSD and wait for the market to recalibrate