Euro Targets Highs Near 1.3550
EURUSD – Retail forex trading crowds have remained aggressively net-short the Euro against the US Dollar since the pair broke above $1.2700, and the fact that crowds continue to sell gives us consistent signal that the pair may yet head higher. Total short positions rose 12.3% from last week, while longs are down a similar 13.3%.
Our Speculative Sentiment Index ratio stands at -1.93 as there are 1.93 traders short for every long (approximately two-thirds of all traders are short). As long as traders remain so aggressively bearish we will continue to watch for further highs.
There seems to be little in the way of Euro technical resistance until the 61.8% Fibonacci retracement of the 1.4250-1.2620 decline at 1.3620 as well as significant highs near 1.3550. Traders might also watch how the EURUSD reacts around the 100-day SMA at 1.3330.
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--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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