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Implications: Bearish

EUR: The 52 and 13 week indexes are both at 0 and Composite COT is below 0 for the first time since late 2005 (last major bottom).  Both indexes indicate a bearish extreme but keep in mind that extremes can last a while.  Also, extreme readings immediately following a reversal often confirm a change in trend rather than signal a contrarian (bullish in this case) opportunity.  In other words, the extreme reading ‘announces’ a new trend, bearish in this case.  This actually happened in late 2004.  Still, be careful on the short side.