Euro technical forecast: neutral
- The Euro appears to be consolidating following recent upswing; speculators have a lot of room to raise prices in positioning futures.
- The net long positioning of the euro is back at its highest level since the last week of March.
- The IG customer mood index sugpose it EUR / JPY and EUR / USD there are bullish inclinations, however EUR / GBP has a neutral weather view.
Euro prices weekly overview
The euro will mostly turn positive by mid-May, even if the headline statistics don’t show it. Although four EUR baptisms increased and three EUR baptisms fell, the bias was on the rise: the average loss was -0.10%, while the average profit was + 0.81%. In this respect, the euro appears to be consolidating after a sharp rise against shelters, while the volatility of global stock markets is giving traders a reason to pedal against commodity currencies.
Absolutely Economic euro data forecasts, see DailyFX economic calendar.
EUR / USD RATE TECHNICAL ANALYSIS: AGENDA (May 2020 – May 2021) (CARD 1)
EUR /USD interest rates made little progress last week, but may still be more beneficial; the consolidation on Thursday has taken place following the breach of the lateral consolidation path that defined price increases since mid-April. The vigorous momentum remains firm, the pair is over their daily 5-, 8-, 13- and 21-EMA envelopes, which are still in a bullish bullish sequence. The Daily MACD moves sideways above its signal line and the Daily Slow Stochastics keep the overbought territory. The past with the least resistance remains higher; The highest value of 2021 in 2021 is looked into the eye.
IG Client Mood Index: EUR / USD Forecast (May 21, 2021) (Figure 2)
EUR / USD: Retailers’ data show that 32.22% of traders are net long, the ratio of short to long traders is 2.10: 1. The number of net long traders is 10.43% lower than yesterday and 11.90% lower than last week, while while the number of net-short traders is 6.26% lower than yesterday and 0.15% less than last week.
We usually view the contradictory situation of the crowd and the fact that traders are short indicates a continuing rise in EUR / USD prices.
Traders are shorter online than yesterday and last week, and the combination of the current mood and recent changes gives us a stronger controversial trading policy for the EUR / USD bullish.
EUR / JPY RATE TECHNICAL ANALYSIS: AGENDA (May 2020 – May 2021) (CARD 3)
EUR /JPY rates reached the highest level of the fresh month and year last week before watering – however, this is not a sign that the bulls have reached exhaustion. Contextually EUR / JPY rates are move on after breaking the downtrend f(the highest ever) and 2014 back in April. The momentum has not been materially damaged, as the couple above their daily EMA envelopes, which are still in ascending order. The daily MACD continues to move higher, being above its signal line, and the daily slow stochastics keep the overbought territory. EUR / JPY appears to be in the highest / 2014 low range of 61.8% for testing Fibonacci retracement (which has since covered the entire EUR / JPY price operation) at 134.29.
IG Client Mood Index: EUR / JPY Forecast (May 21, 2021) (Figure 4)
EUR / JPY: Retailer data show that 33.14% of traders are net long, the ratio of short to long traders is 2.02: 1. The number of net long traders is 9.16% lower than yesterday and 11.97% lower than last week, while the number of net-short traders is 5.54% lower than yesterday and 3.60% higher than last week.
We usually view the crowded situation and the fact that traders are short indicates a continuing rise in EUR / JPY prices.
Traders are shorter online than they were yesterday and last week, and the combination of the current mood and recent changes gives us a stronger controversial EUR / JPY bullish trading policy.
EUR / GBP RATE TECHNICAL ANALYSIS: AGENDA (May 2020 – May 2021) (CARD 5)
It has previously been stated that “EUR /GBP interest rates have traded in a growing triangle, suggesting that there may be another rise in the next several weeks.“But the pair has prolonged the formation of their growing triangle pattern, prolonging consolidation. It may be that the right shoulder and the shoulder pattern are carved upside down; on the other hand, a reversal of the upward trend would mean a lower effort than the downturn in April and May (given that the pre-consolidation step was negative). It remains the case that “more time is needed before a decisive break in direction can be identified…there may be better opportunities elsewhere.“
IG Customer Mood Index: EUR / GBP Forecast (21 May 2021) (Figure 6)
EUR / GBP: Retailer data show that 57.10% of traders are net long, the ratio of long to short traders is 1.33 to 1. The number of net long traders is 1.28% yesterday and 12.78% lower than last week. while the number of net-short traders is 10.00% lower than yesterday and 8.58% higher than last week.
We usually take a contradictory view of the crowd, and the fact that traders are net long suggests that EUR / GBP prices continue to fall.
Positioning is longer than yesterday, but less than last week. The combination of the current mood and recent changes gives us even more mixed EUR / GBP trading prejudices.
CFTC COT Euro Futures Positioning (May 2020 – May 2021) (Figure 7)
Finally, looking at positioning according to the CFTC last week’s COT May 18, speculators increased their net long euro positions for the third time in four weeks to 93,907 cattracts compared to 84,829 contracts signed last week. The net long positioning of the euro is close to the highest level since the last week of March.
– Written by Senior Currency Strategist Christopher Vecchio, CFA