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"On current information, they [the ECB] seem pretty far away from easing."
- Nomura Securities (based on MarketWatch)
Pair's Outlook
Although there were good reasons to believe that EUR/USD would not surge above 1.38, the currency pair approached the Dec 27 high and seems to be willing to remain on a bullish path for now. If this is the case, the next resistance to try to stop the advancement of the rate is the monthly R1 level at 1.3923, while the major down-trend line is now likely to act as a support.
Traders' Sentiment
As a result of a precipitous increase in Euro's price, more of the SWFX market participants consider the single currency to be overvalued—the share of short on EUR/USD positions went up from 58% up to 68%. As for the orders, the distribution between the buy and sell ones is 44% and 56% respectively.
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