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. See our updated Privacy Policy here.

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
Subscribe
Please try again
More View more
Euro Likely Bottomed versus US Dollar

Euro Likely Bottomed versus US Dollar

David Rodriguez, Head of Product
ssi_eur-usd_body_Picture_6.png, Euro Likely Bottomed versus US Dollar

Retail forex traders remain net-long the Euro against the US Dollar (ticker: USDOLLAR), but a significant turn in positioning pushed our “Tidal Shift” trading strategy to take a contrarian long position on the EUR bounce. Last week we wrote that a Euro turnaround seemed imminent, and we were admittedly early in our forecast. Yet much of the reasoning remains the same, and there’s reason to believe that this may be the start of a larger Euro bounce.

Our “Tidal Shift” strategy buys when crowds are their most bearish in the past 145 hours, and its trades have historically caught important market turns as sentiment swings. We see that total crowd long interest fell by 10 percent since last week, while short positioning jumped by a noteworthy 20 percent through the same stretch.

There are certainly no guarantees that this SSI-based forecast will prove accurate, but our technical outlook likewise points to a near-term EURUSD correction higher.

How do we interpret and trade with the SSI? Watch an FXCM Expo Presentation that explains the SSI.

--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com

To receive the Speculative Sentiment Index and other reports from this author via e-mail, send a message with subject line “Distribution List” to drodriguez@dailyfx.com; Contact David via Twitter at http://www.twitter.com/DRodriguezFX

Meet the DailyFX team in Las Vegas at the annual FXCM Traders Expo, November 2-4, 2012 at the Rio All Suite Hotel & Casino. For additional information regarding the schedule, workshops and accommodations, visit the FXCM Trading Expo website.

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

DISCLOSURES