EUR/USD: Bullish Reversal in Play
Short Trades are Up By 20% Overnight
EURUSD: Retail trader data shows 52.5% of traders are net-long with the ratio of traders long to short at 1.1 to 1. In fact, traders have remained net-long since Apr 30 when EURUSD traded near 1.21294; price has moved 3.7% lower since then. The number of traders net-long is 12.7% lower than yesterday and 16.2% lower from last week, while the number of traders net-short is 20.2% higher than yesterday and 18.6% higher from last week.
EUR May Reverse Higher
We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests EURUSD prices may continue to fall. Yet traders are less net-long than yesterday and compared with last week. Recent changes in sentiment warn that the current EURUSD price trend may soon reverse higher despite the fact traders remain net-long.
--- Written by Abdullah AlAmoudi, DailyFX Research
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.