Just saw this article from ZH. An excerpt in the piece from Goldman Sachs:
3. Underlying fundamentals remain Dollar bearish: Despite this correction, however, our underlying views have not changed. We continue to expect the monetary policy differential to widen in favour of the Eurozone. Our view that the ECB will hike in July has not changed. We continue to believe the Fed will remain on hold through 2012, with risks to growth and inflation broadly offsetting each other. Global growth may slow a bit but the underlying story remains supportive for equities, where we continue to expect substantial additional upside over the next 12 months (SPX target of 1525). And most importantly after the sharp drop in oil prices, we remain structurally bullish on key commodities, and this despite the fact that Jeff Currie and team had correctly signalled speculative length as an important short-term downside risk. Most importantly, we think the Dollar continues to be on a downward trend, linked to the continued weak balance of payment situation and increasingly the growing fiscal concerns in the US.
4. Our tactical stance after the sharp moves: On the basis of all these factors, we conclude that the Dollar move is only a temporary correction – painful but quite normal in a strong fundamentally driven trend. Moreover, we have made clear from the outset that our current tactical trades have a bit more of a fundamental flavour than normal. For example, the 1.35 stop and 1.50 target on our EUR/$ trade were both quite far from our 1.4085 entry level. Similarly, in our NJA trades we also remain very far from the stops.
Does anyone really feel comfortable betting real money on fundamental views such as those?
