0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
EUR/USD
Mixed
Oil - US Crude
Bullish
Low
High
of clients are net long.
of clients are net short.
Long Short

Note: Low and High figures are for the trading day.

Data provided by
Wall Street
Bearish
Gold
Bearish
GBP/USD
Mixed
USD/JPY
Mixed
More View more
Real Time News
  • IG Client Sentiment Update: Our data shows the vast majority of traders in Ripple are long at 95.83%, while traders in US 500 are at opposite extremes with 77.46%. See the summary chart below and full details and charts on DailyFX: https://www.dailyfx.com/sentiment https://t.co/EQ77jevtaX
  • Heads Up:🇫🇷 IEA Oil Market Report due at 08:00 GMT (15min) https://www.dailyfx.com/economic-calendar#2020-08-13
  • Hey traders! I'm sure you've all heard about trend trading. Sharpen your knowledge here: https://t.co/jkliL5sxj7 https://t.co/QPW1os7wbE
  • Commodities Update: As of 07:00, these are your best and worst performers based on the London trading schedule: Silver: 0.98% Gold: 0.60% Oil - US Crude: -0.18% View the performance of all markets via https://www.dailyfx.com/forex-rates#commodities https://t.co/gDZGfvBOHv
  • Forex Update: As of 07:00, these are your best and worst performers based on the London trading schedule: 🇪🇺EUR: 0.31% 🇨🇭CHF: 0.22% 🇬🇧GBP: 0.21% 🇦🇺AUD: -0.01% 🇨🇦CAD: -0.03% 🇳🇿NZD: -0.20% View the performance of all markets via https://www.dailyfx.com/forex-rates#currencies https://t.co/9IwXKOUieT
  • Indices Update: As of 07:00, these are your best and worst performers based on the London trading schedule: Wall Street: -0.16% US 500: -0.17% Germany 30: -0.24% France 40: -0.50% FTSE 100: -0.96% View the performance of all markets via https://www.dailyfx.com/forex-rates#indices https://t.co/MtMyrT3zZY
  • Heads Up:🇨🇳 FDI (YTD) YoY (JUL) due at 07:00 GMT (15min) Previous: -1.3% https://www.dailyfx.com/economic-calendar#2020-08-13
  • Emotions are often a key driving force behind #FOMO. If left unchecked, they can lead traders to neglect trading plans and exceed comfortable levels of risk. Read on and get your emotions in check here:https://t.co/eILWbFgHRE https://t.co/ePzB4BuL3s
  • 🇩🇪 Inflation Rate MoM Final (JUL) Actual: -0.5% Expected: -0.5% Previous: 0.6% https://www.dailyfx.com/economic-calendar#2020-08-13
  • 🇩🇪 Inflation Rate YoY Final (JUL) Actual: -0.1% Expected: -0.1% Previous: 0.9% https://www.dailyfx.com/economic-calendar#2020-08-13
EUR/USD Rate Trades to Fresh 2020 High Ahead of Fed Rate Decision

EUR/USD Rate Trades to Fresh 2020 High Ahead of Fed Rate Decision

2020-07-27 03:00:00
David Song, Strategist
Share:

EUR/USD Rate Talking Points

EUR/USD trades to a fresh 2020 high (1.1699) ahead of the Federal Reserve interest rate decision on July 29, and current market conditions may keep the exchange rate afloat as the Relative Strength Index (RSI) sits in overbought territory.

EUR/USD Rate Trades to Fresh 2020 High Ahead of Fed Rate Decision

EUR/USD has taken out the March high (1.1495) as a bull flag formation panned out in July, with the RSI helping to validate the continuation pattern as the oscillator bounced along trendline support to preserve the upward trend from March.

In turn, EUR/USD may continue to carve a series of higher highs and lows as long as the RSI holds above 70, and the bullish price action may persist going into the Federal Open Market Committee (FOMC) meeting as the appreciation in the exchange rate continues to be accompanied by crowding behavior in the US Dollar.

Image of IG client sentiment for EUR/USD rate

The latest update to theIG Client Sentiment report shows the ratio of traders short to long is now at 2.55 to 1 as only 28.20% of traders arenet-long EUR/USD, with the crowd net-short the pair since mid-May. The number of traders net-long is 3.58% lower than yesterday and 7.52% higher from last week, while the number of traders net-short is 3.04% higher than yesterday and 8.74% lower from last week.

It seems as though the EUR/USD rally is fueling net-long interest as it clears the 2019 high (1.1570), while the decline in net-short positions suggests stop-loss orders are being triggered as the exchange rate trades to fresh yearly highs.

It remains to be seen if the crowding behavior in the US Dollar will persist as the FOMC vows to “increase its holdings of Treasury securities and agency MBS (Mortgage-Backed Security) and agency CMBS (Commercial Mortgage-Backed Security) at least at the current pace,” but current market conditions may keep EUR/USD afloat as long as the RSI sits in overbought territory and holds above 70.

Forex for Beginners
Forex for Beginners
Recommended by David Song
Forex for Beginners
Get My Guide

Sign up and join DailyFX Currency Strategist David Song LIVE for an opportunity to discuss key themes and potential trade setups surrounding foreign exchange markets.

EUR/USD Rate Daily Chart

Image of EUR/USD rate daily chart

Source: Trading View

  • Keep in mind, EUR/USD failed to test the March high (1.1495) in June amid the lack of momentum to break/close above the Fibonacci overlap around 1.1430 (23.6% expansion) to 1.1450 (50% retracement), with the Relative Strength Index (RSI) pulling back from overbought territory during the same period after triggering an extreme reading for the second time in 2020.
  • Nevertheless, a ‘golden cross’ materializing towards the end of June as the 50-Day SMA (1.1263) crossed above the 200-Day SMA (1.1074), with the RSI bouncing along trendline support to retain the bullish trend from earlier this year.
  • Will keep a close eye on the RSI as it triggers an overbought reading for the third time in 2020, with the bullish price action in EUR/USD like to persist as long as the indicator holds above 70 amid the behavior seen in June.
  • The bull flag formation panned out following the failed attempt to close below the 1.1190 (38.2% retracement) to 1.1220 (78.6% expansion) region in July, with the continuation pattern producing a break of the 2019 high (1.1570) as EUR/USD carves a series of higher highs and lows.
  • Need a break/close above the 1.1670 (50% retracement) to 1.1710 (61.8% retracement) region to open up the September 2018 high (1.1815), which largely lines up with the Fibonacci overlap around 1.1810 (61.8% retracement) to 1.1850 (100% expansion).
Traits of Successful Traders
Traits of Successful Traders
Recommended by David Song
Traits of Successful Traders
Get My Guide

--- Written by David Song, Currency Strategist

Follow me on Twitter at @DavidJSong

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES

News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site.