The EURUSD looks set to completely retrace the Brexit move if one is judging by the aggressiveness of this bullish reaction. However, from my point of view this is nothing but a bearish triangle part of a double combination and this triangle needs to break lower, not higher.
That being said, staying short and fading this move is only normal and I would say that the downside move needs to be as faster as the upside one, maybe even more aggressive.
Fed minutes the other day shows the FOMC is not in a hurry to raise rates yet and probably until US elections nothing will happen from this point of view. Maybe Jackson Hole to bring us more clarity on the members view, as right now they seem to be split on what to do next.
ECB September meeting will be an interesting one as well in the sense that Draghi will be questioned about how the Eurozone economies will cope with Brexit and further details about future programs the ECB may launch are expected.
All in all, this is no place to be long, so looking South.
About Mircea Vasiu
Mircea Vasiu has an MBA in International Business from an American University, graduating Magna Cum Laudae. He has been a professional trader for the last 8 years and is involved in various educational projects for different financial companies. He also runs a trading signal for the currency markets at www.capitalpropertiesfx.com.