July 17 (Reuters) - EUR/USD is on a technical knife-edge as a European Union summit begins on a 750 billion-euro recovery fund . A reduction in euro longs all week means good news out of the summit should not hinder EUR/USD gains.
No outcome is expected at the summit until late Friday, at best, but either an agreement or a collapse in the talks will have a major impact when trading resumes .
IMM data for the week ending July 7 saw an equivalent EUR/USD cash position of 13.0 billion euros, up from 12.4 billion euros the previous week. EBS data since shows traders may have exited some of those longs, reducing the sell stops that could cause a EUR/USD relapse.
A long shadow on Wednesday's candlestick line is a negative sign that has been compounded by EUR/USD's daily close below the 1.1385 Fibo, a 23.6% retrace of the 1.1168 to 1.1452 recent gain. However, the EUR/USD underlying upward trend remains intact, meaning the technical outlook is mixed.
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IMM Position Chart: https://tmsnrt.rs/2ZziXj0
EBS Flow Data Chart: https://tmsnrt.rs/3eycXeB
Daily Ichimoku Chart: https://tmsnrt.rs/2OC074o
(Martin Miller is a Reuters market analyst. The views expressed are his own)
The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.