14 May 2014
EUR/USD stuck circa 1.37, talk of large stops sub 1.3670
FXStreet (Bali) - EUR/USD trades marginally above the 1.37 round number along quiet Asia after a brief dip to a new 5-week low at 1.3687 last Tuesday.
In the short term, the market has clearly turned bearish, with the latest headlines about the Bundesbank reportedly supporting further ECB easing, note helping the bullish case. However, since the pair is off almost 3 cents from last May 8 high to current levels, a correction higher on Wednesday should not be ruled out, as the smart money seeks more liquidity to keep shorting. On the downside, if a correction fails to materialize, there is talk of large stops sub 13670.
Jim Langlands, Founder at FX Charts, notes: "The Euro has been own to 1.3688, and while I think there is more to come on the downside, the 4 hour charts are at oversold extremes and the hourlies are showing some bullish divergence, so care is needed when entering the market as there could well be a bit of a bounce to flush out the weak shorts in the session ahead."
In the short term, the market has clearly turned bearish, with the latest headlines about the Bundesbank reportedly supporting further ECB easing, note helping the bullish case. However, since the pair is off almost 3 cents from last May 8 high to current levels, a correction higher on Wednesday should not be ruled out, as the smart money seeks more liquidity to keep shorting. On the downside, if a correction fails to materialize, there is talk of large stops sub 13670.
Jim Langlands, Founder at FX Charts, notes: "The Euro has been own to 1.3688, and while I think there is more to come on the downside, the 4 hour charts are at oversold extremes and the hourlies are showing some bullish divergence, so care is needed when entering the market as there could well be a bit of a bounce to flush out the weak shorts in the session ahead."