FOREX ANALYSIS: Trading Systems Sell Euro on Major Sentiment Shift

ssi_eur-usd_body_Picture_7.png, FOREX ANALYSIS: Trading Systems Sell Euro on Major Sentiment Shift

A noteworthy shift in retail FX trading sentiment warns that the Euro may have set a short-term top versus the US Dollar (ticker: USDOLLAR), and one of our sentiment-based trading strategies has accordingly taken a short position from $1.3193.

Traders have remained net-short the EURUSD since the pair traded above $1.27 through mid-November, and normally we would treat this as a contrarian signal in favor of further strength. Yet the number of traders short has fallen by 14 percent while longs are up a noteworthy 38 percent since last week.

Timing reversals is risky, but we see early evidence of an important EURUSD turn lower.

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

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

  • Currencies
    Currencies
    NamePriceChange% Chg
    1.3810-0.0006-0.05%
    USDSGD=X
    1.5370-0.0016-0.10%
    EURSGD=X
    2.0180-0.0028-0.14%
    GBPSGD=X
    80.4888+0.0458+0.06%
    SGDJPY=X
    5.6252+0.0016+0.03%
    SGDHKD=X
    2.9920+0.0147+0.49%
    SGDMYR=X
    9,870.0176+2.834+0.03%
    SGDIDR=X
    4.7674+0.0042+0.09%
    SGDCNY=X
    0.9991+0.0067+0.68%
    AUDSGD=X
  • Commodities
    Commodities
    NamePriceChange% Chg
    1,213.90-2.80-0.23%
    GCQ16.CMX
    16.12-0.15-0.92%
    SIN16.CMX
    79.41-2.71-3.31%
    ^XAU
    2.10-0.01-0.69%
    HGN16.CMX
    49.54+0.21+0.43%
    CLN16.NYM
  • Bonds
    Bonds
    TreasuryYield (%)Yield Change
    1.39+0.04
    ^FVX
    1.85+0.03
    ^TNX
    2.65+0.02
    ^TYX

MARKET MOVERS

  • Most Actives
    Most Actives
    NamePriceChange% Chg
    0.295+0.015+5.36%
    N21.SI
    1.025+0.015+1.49%
    C22.SI
    0.54+0.01+1.89%
    5ME.SI
    3.92+0.02+0.51%
    Z74.SI
    0.380.000.00%
    E5H.SI
  • % Gainers
    % Gainers
    NamePriceChange% Chg
    1.655+0.155+10.33%
    BAI.SI
    0.295+0.025+9.26%
    40T.SI
    0.35+0.03+7.69%
    588.SI
    0.78+0.05+7.59%
    ATL.SI
    0.22+0.02+7.32%
    S71.SI
  • % Losers
    % Losers
    NamePriceChange% Chg
    0.395-0.035-8.14%
    BTJ.SI
    0.285-0.035-10.94%
    S19.SI
    0.26-0.03-11.86%
    BLU.SI
    0.305-0.040-11.59%
    BBP.SI
    0.152-0.019-11.11%
    BEH.SI