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Fear of Cyprus Has Gone Away? EUR/USD Thinks So

April 1, 2013 by Vladimir Vyun

EUR/USD extended its rally for yet another session as it looked like the problems with Cyprus has gone away, at least for now. The data from the United States was not bad, even though manufacturing expansion slowed last month.

ISM manufacturing PMI fell from 54.2% in February to 51.3% in March, while analysts have hoped it would stay unchanged. The data still indicated expansion, albeit with slower pace. (Event A on the chart.)

Construction spending rose 1.2% in February from January, when it fell 2.1%. The actual value was in line with forecasts. (Event A on the chart.)

EUR/USD for 2013-04-01

If you have any comments on the recent EUR/USD action, please reply using the form below.

One Response to “Fear of Cyprus Has Gone Away? EUR/USD Thinks So”

  1. Teddi Knight

    Europe is like a bad cold. It just won’t go away. The Cyprus mess was short lived but it shows the underlying fundamental problems that are going to plague Europe for years to come. The best thing about this from a trading stand point is the ability to earn substantial profits from each mini Europe crisis which sends the Euro down, the US dollar up and the VIX Index on the S&P 500 higher. These have become such easy events to trade against. Each time the mini-crisis starts you simply short the Euro, buy the US Dollar and buy VIX Index calls 3 months out. Then within a couple of days close all the positions for profits and wait for the “fear” to subside. Each mini-crisis out of Europe has played out exactly the same. I am surprised more investors are not engaged in this. It is highly profitable and consistently successful.

    Reply

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