Sell EUR/USD in a break of 1.3790

[B]My picks:[/B] Sell EUR/USD in a break of 1.3790
[B]Expertise:[/B] Global Macro
[B]Average Time Frame of Trades:[/B] 1 week

Diversification away from the US dollar, Fed quantitative easing and a record high US budget deficit are likely to continue to weight negatively on the US dollar in the long term. However, after gaining more than 1200 pips in less than eight weeks the EUR/USD looks overbought and is finally coming under selling pressure from profit-taki. That said, I expect the euro to fall further and test the 200 day SMA at 1.3360 and I will look for an opportunity to sell it in a break below 1.3790. In a side note, this past weekend Europeans voted for the EU parliament but early results did not show any major surprise beyond a record low voter turnout and gains for far-right parties.