Pepperstone logo
Pepperstone logo
  • English
  • 简体中文
  • 繁体中文
  • ไทย
  • Tiếng Việt
  • Español
  • Português
  • لغة عربية
  • Ways to trade

    Pricing

    Trading accounts

    Pro

    Premium clients

    Active Trader Program

    Refer a friend

    Trading hours

    24-hour trading

    Maintenance

  • Trading platforms

    Trading platforms

    TradingView

    MetaTrader 5

    MetaTrader 4

    CopyTrading

    Pepperstone platform

    cTrader

    Trading integrations

    Trading tools

  • Markets

    Markets to trade

    Forex

    Shares

    Indices

    Commodities

    Cryptocurrency

    Currency Indices

    Dividends for Index CFDs

    Dividends for Share CFDs

    CFD Forwards

    ETFs

  • Market analysis

    Market analysis

    Navigating Markets

    The Daily Fix

    Meet the Analysts

  • Learn to trade

    Trading guides

    CFD trading

    Copy trading

    Forex trading

    Commodity trading

    Stock trading

    Cryptocurrency trading

    Bitcoin trading

    Technical analysis

    Day trading

    Scalping trading

    Upcoming IPOs

    Gold trading

    Oil trading

    Webinars

  • Pepperstone Pro

  • Partners

  • About us

  • Help and support

  • English
  • 简体中文
  • 繁体中文
  • ไทย
  • Tiếng Việt
  • Español
  • Português
  • لغة عربية
  • Launch webtrader

  • Ways to trade

  • Trading platforms

  • Markets

  • Market analysis

  • Learn to trade

  • Pepperstone Pro

  • Partners

  • About us

  • Help and support

EUR
USD

The Daily Fix: EURUSD up for an 8th day, time for shorts?

Chris Weston
Chris Weston
Head of Research
Jun 4, 2020
Share
Weakness in the USD continues to be the big theme, although, this has been concentrated against the EUR and the skandies.

EURUSD is up for eight straight days, and we haven’t seen a 9-day run since April 2011, so it feels like the mean reversion crowd may get their time in the sun.

05_06_2020_DFX1.png

I see a 9 count on TD sell set up in EURUSD, so it feels like this pair has scope to move down to 1.1250, before the market steps back in. For all those who have reached out to say this the EUR move is simply short covering, I tend to disagree and while there is most certainly covering of shorts, there is genuine organic longs manifesting here.

I lay out the EUR move, and the actions seen in the ECB meeting, as well as what’s catching my eye more broadly in the daily video.

Trade idea - Bullish US financials on MT5

I have been keen to push the idea that bond markets are key and again we see a strong sell-off in longer-duration bonds, which has once again seen solid buying of US banks. One trade I like is long XLF ETF (US financials) / short SPY ETF. You can find these instruments in MT5, so if the bond market continues to sell off, then banks will further outperform. Banks love a steeper curve, as they borrow short-term and price loans off the long-end – steeper curve equal increased margins.

As with any long/short strategy, the notional exposure must be the same, so lets say I start with a $10k notional, I would therefore buy 396 shares of XLF (price is $25.21) and short sell 32 of SPY ETF (S&P500 ETF). If both instruments go up, I hope the XLF goes up at a faster pace, and if both fall, I hope the XLF falls at a slower pace. A relative play.

One risk in upcoming trade is NFPs. Here is a preview we put together.


Related articles

Risk continues to fly, but watch EUR exposures

Risk continues to fly, but watch EUR exposures

EUR
The Daily Fix: The rise and rise of risk

The Daily Fix: The rise and rise of risk

US

Most read

1

The disinflationary message seen in commodities and rates markets

2

Will the BOJ be the last dovish domino to fall?

3

Trader thoughts - the conflicting forces dictating EURUSD flow

Ready to trade?

It's quick and easy to get started. Apply in minutes with our simple application process.

Get startedSubscribe to The Daily Fix

The material provided here has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Whilst it is not subject to any prohibition on dealing ahead of the dissemination of investment research we will not seek to take any advantage before providing it to our clients.

Pepperstone doesn’t represent that the material provided here is accurate, current or complete, and therefore shouldn’t be relied upon as such. The information, whether from a third party or not, isn’t to be considered as a recommendation; or an offer to buy or sell; or the solicitation of an offer to buy or sell any security, financial product or instrument; or to participate in any particular trading strategy. It does not take into account readers’ financial situation or investment objectives. We advise any readers of this content to seek their own advice. Without the approval of Pepperstone, reproduction or redistribution of this information isn’t permitted.

Other sites

  • The Trade Off
  • Partners
  • Group
  • Careers

Ways to trade

  • Pricing
  • Trading accounts
  • Pro
  • Active Trader program
  • Refer a friend
  • Trading hours

Platforms

  • Trading Platforms
  • Trading tools

Markets & Symbols

  • Forex
  • Shares
  • ETFs
  • Indices
  • Commodities
  • Currency indices
  • Cryptocurrencies
  • CFD Forwards

Analysis

  • Navigating Markets
  • The Daily Fix
  • Meet the analysts

Learn to Trade

  • Trading guides
  • Videos
  • Webinars
Pepperstone logo
support@pepperstone.com
1786 628 1209
#1 Pineapple House,
Old Fort Bay, Nassau,
New Providence, The Bahamas
  • Legal documents
  • Privacy policy
  • Website terms and conditions
  • Cookie policy
  • Sitemap

© 2025 Pepperstone Markets Limited | Company registration number 177174 B | SIA-F217

Risk Warning: CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage.

81.1% of retail investor accounts lose money when trading CFDs with this provider.

You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.

You don't own or have rights in the underlying assets. Past performance is no indication of future performance and tax laws are subject to change. The information on this website is general in nature and doesn't take into account your or your client's personal objectives, financial circumstances, or needs. Please read our RDN and other legal documents and ensure you fully understand the risks before you make any trading decisions. We encourage you to seek independent advice.

Pepperstone Markets Limited is located at

#1 Pineapple House, Old Fort Bay, Nassau, New Providence, The Bahamas

and is licensed and regulated by The Securities Commission of The Bahamas,( SIA-F217).

The information on this site and the products and services offered are not intended for distribution to any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.