EUR/USD : Targets reached / Time to be Neutral on EUR & Very Short Term bearish.

I refer here to January 12th post « EUR/USD  : Triple Bottom ?  »  in which i wrote :

« EUR/USD outlook starts to improve and the 1.0450-1.0600 might be a good level to buy EUR in USD portfolios / hedge USD in non USD portfolios. i believe one can refocus on targets in the 1.10-1.13 area especially should the 1.0650 50days MA be broken. »

EURUSD trades today around 1.1250 , in the upper part of target range mentionned in January . Some pause is likely due ; the move has been quick since first round of France election and traders sentiment towards Euro ( DSI see Daily Sentiment Index on trade-future.com) is  becoming extreme at 75%. Last such extremes – 86% in August 2015 & 78% in May 2016 – lead to 10% and 5% reversal reaction respectively .

1.0950 – 1.10 are the very short term target and 1.08-1.085 should act as base for further progress mid term .. if these latter  levels are reached again which i am not sure of.

On the up side a clear break of 1.1350 would propel the EUR higher to test 2015 & 2016 Highs at 1.16 / 1.17.

In a nutshell : Short term « risk/chance » to 1.0850 -1.1000 followed by more upside to 1.16-1.17 later this year.

 

USD Index : DSI index is at 5 % , the more extreme bearish reading on USd in the last 3 years which speaks for a USD positive reaction versus other major currencies like GBP (current 1.2950) ,  JPY current 111) and CHF ( Current 0.9720)