Busch agrees, and he wants to sell the euro if it approaches the top end of its current trading range. He recommends selling the euro against the dollar at 1.2790 with a stop above that 1.2800 level, at 1.2810, and a target of 1.2640. "I want to continue to try to sell until I'm proven wrong."
Todd Gordon, co-head of research and trading at Aspen Trading Group, is wary of this plan. "I feel like the euro trade is overcrowded," he says, noting that euro-dollar did not break to a new low on Friday when S&P futures did. "That's a sign that FX might be telling the market something else." But that something might just be a bigger idea, Gordon says. He thinks there is an Elliott Wave pattern forming that could take the euro as high as 1.2850 before it resumes its downward trend, so he questions Busch's stop rather than the idea of selling the euro short.
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