The Euro remains heavy as it trades just above Friday’s lows of 1.4644, but like the British pound, forex positioning shows that the currency has hit a bearish extreme and is likely nearing a bottom.

Economic did not aid the Euro in any way, as the Euro-zone trade balance plunged to -3 billion euros in June, marking the worst deficit in nearly 2 years. A breakdown of the report shows that surging oil prices were partly responsible for the deterioration in the balance, as they boosted the value of energy imports. Furthermore, the appreciation of the Euro relative to the US dollar dented American demand for European exports. Looking ahead to Tuesday, sentiment amongst Germany’s financial analysts is likely to turn more pessimistic in August, according to the ZEW survey. The figure is scheduled to be released at 05:00 EDT, and this indicator tends to be a significant market-mover for the EUR/USD pair on a very short-term basis. Given persistent inflation pressures, the marked slowing in the Euro-zone’s economies, and the European Central Bank’s increasingly pessimistic tone during the survey period, the ZEW reading is likely to fall in line with – if not more than – expectations.