From the FXWW Chatroom: My sense is that the market has either already added to EUR longs yesterday afternoon or bought it first thing this morning around 1.0920. As the Dollar continues to trade well across the board, positioning remains the primary driver. That being said, I have bought the dip here at 1.0905 and will look to add on dips toward 1.0890. I have strong support lining up at 1.0890 – the uptrend from round 1 of the French elections. Below 1.0875, I think the market starts feeling the pain as positioning shows market speculators with the longest EUR positioning in years and EUR RR now bid for calls. All of this suggests the market is ill-prepared for a move toward 1.0850. A break below 1.0875 opens up 1.0820/30 – the lows of past month. Admittedly, given the empty calendar today, it’s hard to see what will turn EUR, but I think these are reasonable levels to get long EUR and EURGBP after the sell-off. Below 1.0875 requires reassessment. Support at 1.0890 and 1.0830. Resistance at 1.0935 and 1.0975.
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