EUR/USD & Market Sentiment-Flipping the Boat

From Tuesday's post, Sentiment Flip-Flop with the following excerpts and charts...

"As I said just yesterday in seeing the market ready to shake-out the newly bearish traders,

"The one thing I don't like is the increased market perception and fear, that tilts the ship too far one way and it's very lucrative for Wall Street to rock the boat in the other direction quickly, stopping out or triggering trades, it''s short term maneuvering that has little to do with the bigger picture, but it makes them money."

This is the Fear/Greed Index form YESTERDAY, the 15th...

EXTREME FEAR just yesterday triggering the comments above also from yesterday, And What does Wall Street do when the boat is leaning too far in one direction? They take advantage of it.

The daily SPX chart with the failed head fake move in May and the recent support created at the SPX 150-ma which was already getting attention.  As I said yesterday, "Now all of the stops will be at the 150-sma".

Fast forward to right now...

Sentiment has certainly been shifted and all of those newly bearish traders' / shorts from early in thee week are shaken out, as well as the newly bullish BTD crowd chasing prices higher right in time for a Greek Rumor that would end all problems , but was completely irrational and unsourced. Note the longer upper wick on today's SPX daily candle.

This is the set-up I was referring to Tuesday because of the sentiment imbalance.

this may not be the best segue to the EUR/USD charts, remember I expected a mild $USD bounce and EUR/USD pullback. I am not expecting a lot from the $USD, in fact big picture I'm expecting it to make a primary trend lower low. It has not behaved as the charts imply over the last 24 hours, but that's obviously part of the F_O_M_C and now the second event of the week is having its say, the Greek drama.

There has been significant improvement in the $USD and notable deterioration in the Euro, especially since the EuroGroup meeting ended today with no favorable results other than a rumor to ramp stocks so someone can sell positions, but that seemed to be the entire plan since the 150-day SPX moving average was solidified in traders' minds as support when sentiment was extremely bearish, not so right now. Remember they'll always tip the boat when it's loaded too far on one side, it's easy money.

 The intraday $USD showing improvement today and starting to make its way higher. This may not bode well for GLD in the very near term, especially with today's gap, the reason I closed the second set of GLD calls this morning.

 The intraday Euro Futures with a notable intraday divergence and price decline as the EuroGroup meeting concluded.

The 5 min $USD still has a positive and ...

The 5 min Euro Futures still has a clear negative. Now that the $USD's reaction to the F_E_D and Goldman Sach's overnight analysis has run its course, FX traders seem to be keying in on Greece and the Euro once again, it's the more immediate threat.

I'm not sure this is a trade I'd like to be involved in, but it should have repercussions for certain assets that move opposite the $USD like oil and gold and historically, equities. Just a heads up to keep this in mind as well.