Ok, so the up trend on the EURUSD is no longer a surprise for anybody. We can see that the number of shorts is record low and the number of the traders betting on a stronger EUR is on record highs. How long can it last? Today we will look on a weekly chart and we will try to estimate the potential targets for the current bullish sentiment. Or maybe there are no targets and the EURUSD will just fly away without any stops in the middle whatsoever.
When speaking about the potential targets we are on the one right now. This is a wide (around 100 pips, yellow) area created by the tops from the 2015 and 2016. That looks like a decent resistance, at least for the take profit action. Seeing the latest momentum it is possible that it will not work though. If not, the next potential target is the grey resistance (around 180 pips), which is created by the lows from the 2012 and 2010. If we would break those two without any stronger correction I would be very surprised. Traders are greedy but they need to take profits from time to time too.
We need to remember that strong EUR will become a problem for the top European exporters so countries, which are, by accident (yeah, right) the top ruling nations in the block. I guess they will try to trim the recent sentiment a little bit. As for now, especially with the candle from the last week, there are no reversal signals whatsoever. Only the fact that the price is high and is close to a resistance are not the significant reasons to go short. If you want to sell it would be nice to first see the bearish price action there, signs that demand is retracing and the supply is taking over. Currently I do not see any.
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