Enter the FX market’s ‘Period of Pain’
It’s two weeks before Christmas, liquidity is drying up very sharply indeed according to interbank e-commerce dealers, and all positions are now fair game for the stop-loss munching machines.
USD/JPY was the first to experience the pain with an overly positioned market falling almost 400 pips in a few short sessions. Short EUR positions could well be the next big targets? I’ve exited my short EUR/GBP trade and will sit happily on the sidelines after a rough 6 months 🙁
This is not the time of year for having stubborn fundamental views, this is the time of year to play good defence.