EUR futures: sell the strength?
|According to CME Group’s preliminary figures for open interest in EUR futures, trades have significantly scaled back their contracts by more than 147K to 379,601 vs. Tuesday’s final figures at 526,647 contracts.
Short-covering in play
The recent pick up in spot albeit with decreasing open interest shows a bearish signal. Prices are, in fact, boosted by short covering instead of fundamental demand, implying money is leaving the market and could be anticipating another leg lower once the current scenario abates.
In the meantime, rallies in EUR/USD should face a tough resistance just above the 1.1200 handle, where sits the 20-day sma. On the downside, recent lows around 1.1130 should the magnet for a resumption of the selling bias.
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