Euro Sees Early Signs of Critical Peak - Time to Sell?

DailyFX

View photo

.
ssi_eur-usd_body_Picture_12.png, Euro Sees Early Signs of Critical Peak - Time to Sell?

EURUSD – An aggressive turnaround in the Euro has been met with a similarly pronounced shift in forex trading crowd positions, and our sentiment-based strategies have closed their previous EURUSD-long position.

Trade Implications – EURUSD: The Euro had finally shown signs of breaking out of its multi-week consolidative trading range—hitting fresh highs above key resistance at $1.32. Our sentiment-based Momentum2 trading system did well in going long from $1.3100, and indeed we said that said positioned remained attractive on the probabilities of a broader Dollar breakdown.

Yet that position was taken out at a small gain by its trailing stop loss, and a sharp decline in EUR short positions means that our strategies will likely remain flat through the foreseeable future. The fact that the month-to-date high of $1.3242 occurred at the US session open on the first trading day of the month in fact suggests that the month of May could bring a larger EURUSD sell-off.

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

ssi_eur-usd_body_1a.png, Euro Sees Early Signs of Critical Peak - Time to Sell?

Download all of our Sentiment-based trading strategies free via an ongoing promo on FXCMApps.com

To receive the Speculative Sentiment Index and other reports from this author via e-mail, sign up for his distribution list via this link.

Contact David via

Twitter at http://www.twitter.com/DRodriguezFX

Facebook at http://www.Facebook.com/DRodriguezFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.
Learn forex trading with a free practice account and trading charts from FXCM.

Rates