Danske Bank FX Strategy Research notes that EUR/USD has entered into an overbought territory after breaking above 1.15 overnight, driven by general USD weakness after Republican Senate majority leader Mitch McConnell announced that the US healthcare reform is effectively dead in its current form. Positioning, technical (RSI) and short-term valuation indicate rising headwinds for EUR/USD near term. "1- Non-commercial EUR/USD positioning is approaching stretched long territory, according to IMM data, suggesting the EUR/USD rally could lose momentum near term. 2- We note that EUR/USD is now significantly overbought ... (full story)