Impressive Euro declines and US Dollar rallies have been met with aggressive forex crowd buying and selling, giving us strong contrarian signal to sell into EURUSD declines. Much the same can be said for other US Dollar based pairs; our sentiment-based trading systems are mostly long the USD against the Euro, British Pound, Australian Dollar, and New Zealand Dollar. A noteworthy exception is the Japanese Yen, and indeed several of our SSI-based trading strategies have bought into recent JPY advances against the USD and British Pound. Current sentiment extremes suggest short-term trends will continue and give us a decidedly bearish outlook for the Euro and British Pound.
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.
Learn forex trading with a free practice account and trading charts from FXCM.