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Don’t waste your money with stop-losses. There’s no promise that you’ll like the bid you’re forced to take like the recent EUR/USD squeeze.

FXstreet.com (Barcelona) – In what seems to have been an absurdly exaggerated move up, the EUR/USD is currently trading at 1.3137 after posting a fresh 2-week high at 1.3203.

The catalyst on today’s moves is a combination of a market overly long the USD, twilight liquidity on the transition from NY into Tokyo, and obviously, Fed Chairman throwing cold water on QE taper this September, saying that inflation, jobs signal more Fed stimulus is needed, a very ‘off the cuff’ dovish remark.

In the wildest sequence of hour by hour spikes in 2013, there are some impressive facts about the latest recovery in the EUR/USD which are worth highlighting. The most impressive of all is perhaps the fact that EUR/USD has been able to master over 200 pips of gains in the last hour alone, literally needing only 5 hours of price action to erase 12 days of losses.

According to Eamonn Sheridan, Editor at Forexlive, “It is easy to say these moves are crazy, the move is stupid etc. by all means, say these things – but don’t forget to take away the idea that these sorts of moves happen from time-to-time.” Sheridan goes on saying “when you’ve been around the markets for a while they cease to be shocking.”

Meanwhile, Sean Lee, Founder at FXWW, notes “Those clever enough to have bought yesterday below 1.2800 should take their profits off the table as this is a simple case of stop-loss squeezing gone mad in thin market conditions.”

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E.J. Smith

Editor-in-Chief
E.J. Smith is Founder of YourSurvivalGuy.com, Managing Director at Richard C. Young & Co., Ltd., a Managing Editor of Richardcyoung.com, and Editor-in-Chief of Youngresearch.com. E.J. graduated from Babson College in Wellesley, Massachusetts, with a B.S. in finance and investments. In 1995, E.J. began his investment career at Fidelity Investments in Boston before joining Richard C. Young & Co., Ltd. in 1998. E.J. has trained at Sig Sauer Academy in Epping, NH. His first drum set was a 5-piece Slingerland with Zilldjians. He grew-up worshiping Neil Peart of the band Rush, and loves the song Tom Sawyer—the name of his family’s boat, a Grady-White Canyon 306. He grew up in Mattapoisett, MA, an idyllic small town on the water near Cape Cod. He spends time in Newport, RI and Bartlett, NH—both as far away from Wall Street as one could mentally get. The Newport office is on a quiet, tree lined street not far from the harbor and the log cabin in Bartlett, NH, the “Live Free or Die” state, sits on the edge of the White Mountain National Forest. He enjoys spending time in Key West and Paris. Please get in touch with E.J. at ejsmith@youngresearch.com.