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Euro Poised to Test Multi-Year Lows versus Dollar

DailyFX.com -

Euro Poised to Test Multi-Year Lows versus Dollar
Euro Poised to Test Multi-Year Lows versus Dollar

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EURUSD – The Euro has turned sharply lower, and our sample of retail FX traders shows that crowds have bought aggressively into the EURUSD slide. A contrarian view keeps us watching for further losses.

Trade Implications – EURUSD: Last week we cited a sharp jump in crowd selling as a key reason that the Euro may have set an important low, but the opposite has happened in the past two days in particular. With yesterday’s post-FOMC decision EURUSD tumble, total open long positions are up 16 percent while short positions are down 31 percent since last week.

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Long positions make up 59 percent of total open interest, and a further shift towards crowd buying would keep us squarely focused on a EURUSD test of multi-year lows near $1.2250.

See next currency section: GBPUSD - British Pound Forecast Calls for Further Weakness

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

Euro Poised to Test Multi-Year Lows versus Dollar
Euro Poised to Test Multi-Year Lows versus Dollar

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