EURUSD - LONG POSITION

18 nov 2021

CFTC Speculative Net Positions at -0.547 (Long for the Euro). Bank valuation for this pair sits at 1.1600 and up from there, which makes it extremely undervalued. And even though the main trend is still bearish (and it is going to be like that for quite some time), the Dollar has to take a breathe. The Fed has had a really hawkish position for a long time and that eventually becomes priced in (Some investment fund managers are taking this position). Volatility is still high, but fear is starting to fade, which is good for the Euro. 25 Delta 1 month Risk Reversals are going up really fast, from -0.8 yesterday to -0.55 atm, meaning that traders are changing their prospects for the direction of the pair from bearish to bullish at a high pace.

Technicals: Divergence on the Rsi, break of the trend, hammer candle on the daily chart that matches with a channel support.

EURUSD