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Bullish opportunity slips away – EUR/GBP, EUR/JPY, EUR/USD Settings -by Ecork

Euro forecast:

  • Energy concerns trump everything else for the euroThe news that Russia is limiting gas exports raises concerns about growth.
  • EUR/JPY prices failed to recover upside from March-May swing lows, EUR/GBP fell back to June lows, EUR/USD failed to make a decisive break above the 21-day moving average (1 month) moving average.
  • for every The IG . Customer Confidence IndexAnd the EUR/JPY and EUR/GBP rates have a bullish bias while EUR/USD rates have a bearish bias.

winter is coming

The Euro is dealing with a host of problems at the moment, which is making the European Central Bank (ECB) one of the toughest jobs among the major central banks. Bond market fragmentation remains a risk, although peripheral bond yields have yet to widen compared to their core counterparts. Rates have arrived, although the weak growth trajectory begs the question of how much the ECB can actually achieve.

But the problem of the renewed day is the problem of energy supply in Europe. Russia has announced that it will cut gas supplies through its Nord Stream 1 pipeline only to 20%, sparking fears that eurozone growth will slow further and, perhaps more importantly, that energy stocks will not be stored large enough before winter.

These competing factors, along with pre-positioning adjustments Federal Reserve Board meeting in July tomorrowThe Euro has seen it lose its grip on perhaps its most bullish technical setup in recent months. EUR/JPY prices failed to recover upside from March-May swing lows, EUR/GBP fell back to June lows, EUR/USD failed to make a decisive break above the 21-day moving average (1 month) moving average.

EUR/USD Price Technical Analysis: Daily Chart (July 2021 to July 2022) (Chart 1)

EUR/USD prices declined at 21-EMA (one month moving average) after flirting with the level several times in recent days. The pair has not recorded consecutive closes above the daily 21-EMA since June 7th and 8th. EUR/USD prices are back below the 5, 8, 13 and 21-EMA daily averages, and the EMA envelope is in a descending ordering sequence. The daily MACD retracement failed below its signal line, while the daily slow stochastic did not reach the overbought zone. Turning lower, ahead of the Fed’s July meeting, puts more focus on technical levels to the downside, particularly the yearly low engraved at 0.9952.

IG Client Sentiment Index: EUR/USD Price Forecast (July 26, 2022) (Chart 2)

Euro Outlook: Bullish opportunity slipping away - EUR/GBP, EUR/JPY, EUR/USD Settings

EUR/USD: Retail trader data shows 65.84% of traders are net long with the ratio of long to short traders at 1.93 to 1. The number of long-term traders is 15.12% higher than yesterday and 12.58% higher than last week, in While the number of short traders is 19.22% less than yesterday and down 11.66% since last week.

We usually take a conflicting view with crowd sentiment, and the fact that traders are holding indicates that EUR/USD prices may continue to fall.

Traders are long longer than yesterday and last week, and the combination of current sentiment and recent changes is giving us a stronger bearish mixed trading bias for the EUR/USD.

EUR/JPY Technical Analysis: Daily Chart (July 2021 to July 2022) (Chart 3)

Euro Outlook: Bullish opportunity slipping away - EUR/GBP, EUR/JPY, EUR/USD Settings

EUR/JPY prices have been trying to rally during the uptrend from the March-May swing lows, but that failed. The pair is now below the 5, 8, 13 and 21 EMAs and is aligned with the EMA envelope in a descending sequential order. The daily MACD is moving below its signal line, while the Slow Stochastic is about to cross below its center line. A deeper reversal remains possible for the area between the July low and the 38.2% Fibonacci retracement of the March low/May high range around 136.68/86.

IG Client Sentiment Index: EUR/JPY Price Forecast (26 July 2022) (Chart 4)

Euro Outlook: Bullish opportunity slipping away - EUR/GBP, EUR/JPY, EUR/USD Settings

EUR/JPY: Retail trader data shows that 31.11% of traders are net long with the ratio of short to long traders at 2.21 to 1. The number of long-term traders is 17.28% lower than yesterday and 25.28% lower than last week, while the number of long-term traders is 17.28% lower than yesterday and 25.28% lower than last week. The number of short traders is 8.80% higher than yesterday and 10.42% higher than last week.

We usually take a conflicting view with crowd sentiment, and the fact that traders are shorts indicates that EUR/JPY prices may continue to rise.

Traders are taking more short positions than yesterday and last week, and the combination of current sentiment and recent changes is giving us a bullish mixed trading bias for the EUR/JPY.

EUR/GBP Price Technical Analysis: Daily Chart (July 2021 to July 2022) (Chart 5)

Euro Outlook: Bullish opportunity slipping away - EUR/GBP, EUR/JPY, EUR/USD Settings

In the previous update It was noted that “further losses towards the uptrend line from the March and April swing lows closer to 0.8370 are possible in the near term.” EUR/GBP rates He has made progress in this direction, and has lost ground hard in recent days. With that, the area around the July low and the 61.8% Fibonacci retracement of the March low/June high range near 0.8401/03 are in focus first.

IG Client Sentiment Index: EUR/GBP Price Forecast (26 July 2022) (Chart 6)

Euro Outlook: Bullish opportunity slipping away - EUR/GBP, EUR/JPY, EUR/USD Settings

EUR/GBP: Retail trader data shows that 55.60% of traders are net long with the ratio of traders taking long to short positions at 1.25 to 1. The number of long-term traders is 4.81% higher than yesterday and 14.96% higher than the week The number of short traders increased by 6.10% compared to yesterday, and 21.79% higher than last week.

We usually take a conflicting view with crowd sentiment, and the fact that traders are holding indicates that EUR/GBP prices may continue to fall.

However, traders have lower net longs than yesterday and compared to last week. Recent changes in sentiment warn that the current price trend of the EUR/GBP may reverse upwards soon despite the fact that traders remain net-long.

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— Written by Christopher Vecchio, Chartered Financial Analyst, Chief Strategist

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