EUR/USD Ratio: 1.21 Trading Forecast: Bearish
EURUSD – Our forex positioning indicator accurately forecast that the Euro would fall against the US dollar, as increasingly net-long positions in the EURUSD gave contrarian signal to sell the currency pair. In fact, our SSI-based currency trading signals on DailyFX+ sold the EURUSD at both 1.4331 and 1.4319—a prescient move given the pair’s subsequent tumbles. The ratio of long to short positions in the EURUSD now stands at 1.21 as nearly 55% of traders are long. A broader drop in open interest suggests that the strength of the SSI signal is weaker, but we do note that traders grew increasingly net-long overnight; yesterday, the ratio was at 1.09 as 52% of open positions were long. The SSI is a contrarian indicator and forecasts more EURUSD losses.