Euro Targets Fresh Highs Versus US Dollar
EURUSD – Trading crowds turned aggressively net-short the Euro against the US Dollar as the pair broke above 1.2700, and further selling suggests we could continue to see fresh EURUSD highs. We were initially early in our calls for a larger Euro bounce, but extremely one-sided speculative sentiment suggests that this may be a lasting EURUSD bottom.
Our SSI ratio stands at -1.69 as there are 1.69 traders long for every 1 short. Although past performance is no guarantee of future results, such one-sided extremes can often come at major turning points. Indeed, we remain bullish until further notice.
The next major EURUSD resistance is very close by at the December 22 high of $1.3198. We see little in the way of major resistance beyond that until the December high of $1.3548.
How do we interpret the SSI? Watch an FXCM Expo Presentation that explains the SSI.
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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