EUR/USD Ratio: 1.10 Trading Forecast: Bearish
EURUSD – Our Forex positioning indicator accurately forecasted Euro/US dollar declines through recent trade, and contrarian analysis of current “crowd” trading likewise signals that the EURUSD may continue its decline. 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. Yet the strength of this signal has clearly faded through recent price action; the ratio of long to short positions in the EURUSD stands at 1.10 as a mere 52% of traders are long. Last week we saw that 55 percent open EURUSD positions were long, and a 40.5 percent weekly drop in EURUSD-long positions clearly shows that bullish “crowd” bias on the EURUSD is fading recently. Our contrarian signal continues to forecast EURUSD losses, but we may see a short-term correction through upcoming forex trade.