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Euro Rallies Seem a Little too Obvious

Euro Rallies Seem a Little too Obvious

2013-12-12 16:45:00
David Rodriguez, Head of Business Development
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ssi_eur-usd_body_Picture_9.png, Euro Rallies Seem a Little too Obvious

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EURUSDRetail FX traders are near their most net-short the Euro versus the US Dollar on record, warning of a potential sentiment extreme and increasing risks of a near-term EURUSD top.

Trade Implications – EURUSD: Extremes are only clear in hindsight, and as such the consistent crowd Euro selling has actually kept us bullish for some time now. In fact our sentiment-based Momentum2strategy remains long from $1.3649.

Yet the record net-short position warns that further EURUSD upside will likely be limited. It’s unusual to see currencies stage major reversals mid-month, but there’s high risk of a near-term top heading into the final weeks of December and the calendar year.

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

ssi_eur-usd_body_Picture_10.png, Euro Rallies Seem a Little too Obvious

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

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