Plain and sinply put, the higher lows that we see in EUR/USD on the below daily chart bode well for our long-standing view of EUR/USD breaking higher. We continue to target the 1.47xx handle.
Sentiment seems to be changing ever since last Friday’s NFP data, with more and more traders and analysts looking to short EUR/USD. But the chart and some data this morning out of Eurozone (better than expected growth rates in France and Germany) remind us that some of the best indicators of medium term currency movements is reverse sentiment indicators.
A look at the below daily chart shows higher lows for EUR/USD in since early July. We added in Bollinger Bands to verify and note that a close today above the midline (approx 1.4234) will further validate our bias towards higher EUR/USD.
Our Stop Order for our full long EUR/USD position (see previous posts at www.backbayfx.com/blog.php) is presently on a daily close below 1.3750. We will move that level up today if the market closes above 1.4234.
Stay Nimble!
Stephen Leahy
Back Bay FX Services, LLC
www.backbayfx.com
Thanks for FX Sol for the below image!
