DailyFX.com - We Like Joining the Crowd and Buying Euro Here

Receive the Weekly Speculative Sentiment Index report via PDF via David’s e-mail distribution list.

EURUSD – Forex trading crowds have bought aggressively into Euro weakness as it nears critical support versus the US Dollar, and the sharp shift warns of volatility ahead.

Trade Implications – EURUSD: We most often go against the crowd; if everyone’s recently bought we like to sell and vice versa. Yet the issue is that extremely low forex volatility gives little reason to expect a major Euro breakdown here. And in fact, the retail trading crowd is often on the right side of major reversals in low-volatility environments.

We’re cautiously bullish the EURUSD until we see a bigger shift in market conditions. A break below $1.35 would obviously negate this bias and be accompanied by a jump in broader market volatility.

See next currency section: GBPUSD - British Pound Rally not Done Just Yet


Filed Under:
Forex pairs in this Article » EUR/USD

comments powered by Disqus
Trading Center