Photo: Bloomberg TV
Given the uncertainty in Europe, it is surprising to some that the euro continues to trade at 1.27-1.28 against the dollar. But is that a reason to be bullish on the currency?In an interview with Bloomberg TV, John Taylor, chairman and CEO of FX Concepts, a currency hedge fund, who has been building short positions on the euro, said for now, the euro is oversold but it will go down soon:
“I think we’re way oversold in the Euro, so I think we’ll go through a week of calm. That is a week of attempting to force all the people who are happy like me to be unhappy i.e. the euro will come up till like first of June or maybe the fourth of June, and then the reality of the Greek election will set in and it’ll start going down.
…Actually we’re starting to back off a little bit for a quiet week and hopefully an end of the month it’ll be OK. I don’t expect to see the euro get hammered in the next five – six days.”
He said Greek shipowners had all their money in Hamburg two years ago and now the man on the street is either hiding it in his mattress or sending it to a cousin abroad, and “numbers show it’s happening in Spain, Portugal and Italy.
Taylor also said the only way for the euro to survive was to put the Greek mess behind it, namely, “Germans should throw the Greeks out, the Greeks should ask to get out.”