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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Market Data

  • Currencies
    Currencies
    NamePriceChange% Chg
    1.3619+0.0046+0.34%
    USDSGD=X
    1.5247+0.0051+0.34%
    EURSGD=X
    2.1021+0.0108+0.52%
    GBPSGD=X
    87.9249-0.0508-0.06%
    SGDJPY=X
    5.6952-0.0186-0.33%
    SGDHKD=X
    2.6543+0.0004+0.01%
    SGDMYR=X
    9,545.8398+66.7422+0.70%
    SGDIDR=X
    4.6064-0.0038-0.08%
    SGDCNY=X
    1.0635+0.0051+0.48%
    AUDSGD=X
  • Commodities
    Commodities
    NamePriceChange% Chg
    1,218.20+7.20+0.59%
    GCM15.CMX
    16.65+0.03+0.16%
    SIK15.CMX
    77.46+1.63+2.15%
    ^XAU
    2.68-0.02-0.69%
    HGK15.CMX
    49.06+0.89+1.85%
    CLJ15.NYM
  • Bonds
    Bonds
    TreasuryYield (%)Yield Change
    1.50-0.02
    ^FVX
    2.01-0.01
    ^TNX
    2.610.00
    ^TYX

MARKET MOVERS

  • Most Actives
    Most Actives
    NamePriceChange% Chg
    0.975-0.085-8.02%
    N21.SI
    0.405-0.005-1.22%
    E5H.SI
    0.280.000.00%
    5WA.SI
    0.70-0.01-1.41%
    Y92.SI
    0.985+0.005+0.51%
    G13.SI
  • % Gainers
    % Gainers
    NamePriceChange% Chg
    0.17+0.03+21.43%
    40B.SI
    0.24+0.02+11.63%
    B1N.SI
    0.625+0.060+10.62%
    L5I.SI
    0.80+0.07+9.59%
    533.SI
    0.24+0.02+9.09%
    D79.SI
  • % Losers
    % Losers
    NamePriceChange% Chg
    0.42-0.04-8.70%
    CH8.SI
    0.105-0.010-8.70%
    J8O.SI
    0.14-0.01-8.50%
    5TJ.SI
    0.975-0.085-8.02%
    N21.SI
    0.29-0.03-7.94%
    AFC.SI