EUR/USD rebounds from 1.2826/1.2791

A two-week decline was ensued by a strong rally from 1.2826/1.2791, which is able to extend further, up to 1.34. Once 1.3151/71 is overcome, the way will be cleared towards a major downtrend resistance line, from where EUR/USD is expected to slide down for a protracted period of time. This view is also reinforced by monthly technical indicators and medians of bank forecasts for the next three quarters.

Even though popularity of the greenback has somewhat diminished, as on average 62% (65% on October 1) of positions on it are long, traders' sentiment is unchanged towards EUR/USD, being that 43% of traders are long and 57% are short on the currency pair.