Why Did We Cover our British (EWU) Short Position Today?

One, the EWU was down over -6%, and we cover on red meltdown days... Two, and more importantly, as bad as this morning's jobless claims # in the UK was (worst since 1992), the rate of change improved sequentially (i.e. less bad, see chart).

Everything that matters in our macro models occurs on the margin. Today's delta was an important one. Look for the British to cut interest rates again in the near future.