Big Shift in Trader Sentiment Warns Euro May have Turned
EURUSD: Retail trader data shows 26.8% of traders are net-long with the ratio of traders short to long at 2.73 to 1. In fact, traders have remained net-short since Apr 18 when EURUSD traded near 1.06424; price has moved 6.6% higher since then. The number of traders net-long is 0.5% higher than yesterday and 31.2% higher from last week, while the number of traders net-short is 6.3% lower than yesterday and 4.8% lower from last week.
We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests EURUSD prices may continue to rise. Yet traders are less net-short than yesterday and compared with last week. Recent changes in sentiment warn that the current EURUSD price trend may soon reverse lower despite the fact traders remain net-short.
See next article in this week’s report: GBPUSD - British Pound Trend May have Changed versus Dollar
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