forex EUR/USD: Hedge Funds Continues to Short the Euro

[Anzo Lim 0]

https://jump.wikifx.com/83348CF26389B46D

The euro hit a 10-day low against US dollar on Monday, and investors remain cautious about the short-term economic outlook of the Eurozone. Although German business confidence improved slightly in November, the Eurozone still faces uncertainties in its economic prospects, while business growth in the region has been almost stagnant this month.

European Central Bank President Lagarde and other ECB members may step up bond purchase or cut interest rates further to support the weak Eurozone economy. Taking into account the overall weakness of the Eurozone economy, the ECB is expected to reduce interest rates by another 10 basis points to -0.60% at the December policy meeting.

Hedge funds are betting on the euro to fall and increased their short positions, and last week's data showed that overall net short positions increased slightly. The European Central Bank has restarted its bond purchase program and further lowered the interest rate to negative in September. However, these stimulus measures appeared to be ineffective, as the euro has dropped 1.5% this month. Economic signals are worrying and the euro remains weaken against the US dollar.

 

EUR/USD daily pivot points: 1.1013--1.1017

S1: 1.0999          R1: 1.1027

S2: 1.0987          R2: 1.1043

Edited November 26, 2019 by Anzo Lim