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Sep 12 - 04:55 AM

EUR/USD - There Is Virtually No Chance Of A EUR/USD Short Squeeze

By Jeremy Boulton  —  Sep 12 - 02:45 AM
  • EUR/USD has traded a series of rising daily lows since Sep 6 (bullish)

  • Traders pared 25% of the net short position between Aug 30 and Sep 6

  • EUR/USD traded 1.0079 to year low at 0.9864 while shorts covered

  • Sep 6 net short just $4.5 billion. Sep 12 pair reaches 1.0130 EBS

  • Most shorts covered profitably, traders usually reestablish winning bets

  • The minimum criterion to correct drop influenced by Fed is 1.0781

  • A short squeeze is the exit of distressed positions

  • That eventuality is remote, needs rise way above levels currently trading

  • Short covering/profit taking could provide EUR/USD further support

  • There are too few shorts to influence a change of the trend


Source:
Refinitiv IFR Research/Market Commentary

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