Fundamentals and technicals continue to support my short EUR/NOK trade — I will look for a chance to get back in.

The inverse correlation between equity markets and the US dollar seems to be breaking down. I was very aware that I was betting on this when I entered my short EUR/USD trade, given that I expect equity markets to continue to rally. The technicals suggest a turning point, and I suspect articles like this one are a consequence of that rather than an independent indicator. Nonetheless, it can only be good if a “turning point for the dollar” story takes hold. UBS seems to be helping here, with some of the same fundamental arguments that I had for entering the trade. Goldman Sachs is still advising clients to short the dollar, on the basis of the balance of payments — which sounds like a limp argument to me. Perhaps they are short themselves.

I am thoroughly disinclined to join this party. Almost everything is a bet on central bank action at the moment, but betting on whether or not the Swiss central bank is still inclined to intervene in the currency market is too binary for me.