I have been wondering about EUR/USD and its amazing resilience in the face of all that’s happening in the past fortnight.
Economic numbers turning sour and nothing quite resolved and we have the G20 meetings coming up between 18-20 April where we will have some finger pointing exercises at poor old Japan.
So I pulled out this interesting chart to share.
The CPAINEUR index (white line) is the detector for crowded market positions and it seems that EUR longs have exited throughout the month of March whilst the Economic Surprise Index (green line) has fallen to negative territory though it probably has not bottomed.
Poor economic news has been factored in this recent run up from the low of 1.27 to 1.3180 today.
It would seem wrong for EUR/USD to rally further from here and the next ECB is on 2 May. But it broke the 100 day moving average so easily yesterday and we are still holding above it.
I am wondering, given that the heat has been taken off Europe for the moment, if there is a possibility of a further rally from here to 1.3250-1.33 to clean out the books for next month.
Not a convinced view, but just a hunch. Buy on pull back ?