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
    1.40870.000.00%
    USDSGD=X
    1.57200.000.00%
    EURSGD=X
    2.0437+0.0012+0.06%
    GBPSGD=X
    83.00920.000.00%
    SGDJPY=X
    5.5295+0.0028+0.05%
    SGDHKD=X
    2.95360.000.00%
    SGDMYR=X
    9,664.94040.000.00%
    SGDIDR=X
    4.66810.000.00%
    SGDCNY=X
    0.9983+0.0009+0.09%
    AUDSGD=X
  • Commodities
    Commodities
    NamePriceChange% Chg
    1,165.90+8.40+0.73%
    GCJ16.CMX
    14.94+0.09+0.61%
    SIH16.CMX
    55.30+2.68+5.09%
    ^XAU
    2.09-0.04-1.92%
    HGH16.CMX
    31.04-0.68-2.14%
    CLH16.NYM
  • Bonds
    Bonds
    TreasuryYield (%)Yield Change
    1.250.00
    ^FVX
    1.85-0.02
    ^TNX
    2.68-0.02
    ^TYX

MARKET MOVERS

  • Most Actives
    Most Actives
    NamePriceChange% Chg
    0.33+0.02+4.76%
    N21.SI
    3.70+0.22+6.32%
    Z74.SI
    1.68+0.05+3.07%
    MC0.SI
    0.385+0.010+2.67%
    E5H.SI
    0.705+0.025+3.68%
    G13.SI
  • % Gainers
    % Gainers
    NamePriceChange% Chg
    0.405+0.065+19.12%
    T4B.SI
    0.475+0.075+18.75%
    Y06.SI
    0.23+0.03+15.00%
    S9B.SI
    0.40+0.05+14.29%
    BJE.SI
    0.144+0.014+10.77%
    AWS.SI
  • % Losers
    % Losers
    NamePriceChange% Chg
    0.34-0.05-12.82%
    MN5.SI
    0.118-0.012-9.23%
    AWO.SI
    0.205-0.020-8.89%
    AYL.SI
    0.505-0.045-8.18%
    A05.SI
    0.193-0.017-8.10%
    S71.SI