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
    1.3514+0.0003+0.02%
    USDSGD=X
    1.4727-0.0001-0.01%
    EURSGD=X
    2.0663-0.0079-0.38%
    GBPSGD=X
    91.9266+0.3497+0.38%
    SGDJPY=X
    5.7375-0.0048-0.08%
    SGDHKD=X
    2.6990+0.0022+0.08%
    SGDMYR=X
    9,766.2041+14.1475+0.15%
    SGDIDR=X
    4.5910+0.0016+0.03%
    SGDCNY=X
    1.0317-0.0127-1.22%
    AUDSGD=X
  • Commodities
    Commodities
    NamePriceChange% Chg
    1,186.70+0.20+0.02%
    GCQ15.CMX
    16.650.00+0.02%
    SIN15.CMX
    68.76+0.07+0.10%
    ^XAU
    2.770.00+0.16%
    HGN15.CMX
    57.41-0.10-0.17%
    CLN15.NYM
  • Bonds
    Bonds
    TreasuryYield (%)Yield Change
    1.53+0.01
    ^FVX
    2.130.00
    ^TNX
    2.88-0.02
    ^TYX

MARKET MOVERS

  • Most Actives
    Most Actives
    NamePriceChange% Chg
    0.195+0.020+11.43%
    F13.SI
    0.415-0.010-2.35%
    E5H.SI
    0.335-0.005-1.47%
    AFC.SI
    0.290.000.00%
    5WA.SI
    4.12-0.04-0.96%
    Z74.SI
  • % Gainers
    % Gainers
    NamePriceChange% Chg
    0.18+0.03+20.00%
    P36.SI
    0.155+0.021+15.67%
    5F4.SI
    0.128+0.014+12.28%
    510.SI
    0.195+0.020+11.43%
    F13.SI
    0.33+0.03+8.20%
    T18.SI
  • % Losers
    % Losers
    NamePriceChange% Chg
    0.192-0.108-36.00%
    AYE.SI
    0.15-0.02-11.76%
    5MQ.SI
    0.31-0.04-11.43%
    AYL.SI
    0.098-0.011-10.09%
    O2I.SI
    1.80-0.20-10.00%
    AYC.SI