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Euro Forecast Unclear on Indecisive Forex Positioning
Thursday, 15 January 2009 14:08:02 GMT  |  David Rodriguez, Quantitative Analyst and Antonio Sousa, Chief Strategist
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EUR/USD ratio: -1.04
Trading Forecast: Bullish

01-15-2009_2

EURUSD – Our forex positioning-based forecast for the Euro/US Dollar is currently unclear, as trading crowds are very near neutral in their bias towards the currency pair. The ratio of long to short positions in the EUR/USD stands at a modest -1.06 as only 51% of traders are short. Yesterday, the ratio was at 1.17 as 54% of open positions were long. The marginal shift comes from the fact that short positions are 22.9 percent higher than yesterday, but overall sentiment is roughly unchanged on the week. The SSI is a contrarian indicator and the net-short trader bias signals gains are likely, but we have little confidence in this forecast. Our sentiment-based forex trading signals are accordingly flat the Euro/US dollar through current price action. 

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