Sept 23 (Reuters) - EUR/USD has reached a point where longs should be considered, but it may have reached that point at the wrong time .
For traders, timing is key. Having the right idea means little if you time your trade badly. Those who see 1.1691 as a good point of entry for EUR/USD longs are correct. At that point, the pair will have fulfilled the minimum objective for a correction of the rise from June's low at 1.1168.
So from a technical standpoint, it's a good spot to buy. But there are others factors. Recently, longs hit a record level and while they have been trimmed, they remain large and therefore will drag on EUR/USD.
There is also a clear rise in risk aversion alongside growing concern about the impact of a second wave of the coronavirus .
When risk aversion rises, traders usually trim bets, heightening the probability of a deeper correction. Ideally, EUR/USD would reach 1.1488 or 38.2% of its 20020 rise before rallying.
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(Jeremy Boulton 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.