[B]EURUSD – Euro Forecast to Decline Further on Shift in Forex Sentiment
GBPUSD – British Pound Outlook Remains Bearish on Sharp Sentiment Shifts
USDJPY – Japanese Yen Outlook Modestly Bullish Against US Dollar
USDCHF – Swiss Franc Looks to Gain Versus US Dollar
USDCAD – Canadian Dollar Forecast Summarily Unclear Versus US Dollar
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While the SSI is available once a week on DailyFX.com, you can receive SSI readings twice a day in DailyFX Plus [I]Forex Intraday Trading Signals[/I][I]
The SSI sought a EURUSD rally since 1.26 and was signaling a reversal around 1.60. Find our more in the DailyFX [/I][I]Forex Forum [/I]
Historical Charts of Speculative Forex Trading Positioning
EURUSD – Extremely choppy Euro/US Dollar price action has made for sharp shifts in our sentiment indicator, and the most recent turn suggests that the EURUSD could continue to decline. The ratio of long to short positions in the EURUSD stands at -1.10 as nearly 52% of traders are short. Yesterday, the ratio was at -1.72 as 63% of open positions were short. In detail, long positions are 29.1% higher than yesterday and 13.3% stronger since last week. Short positions are 17.0% lower than yesterday and 1.5% weaker since last week. The sharp jump in long positions and similar drop in short positions gives us contrarian signal to look for further EURUSD losses.
GBPUSD –Sharp shifts in British Pound/US Dollar sentiment give us signal that the GBPUSD may continue to decline. Indeed, our sentiment-based forex trading strategies remain heavily short the pair on the pair’s recent drops. The ratio of long to short positions in the GBPUSD stands at 1.31 as nearly 57% of traders are long. Yesterday, the ratio was at 1.06 as 51% of open positions were long. In detail, long positions are 10.3% higher than yesterday and 28.7% stronger since last week. Short positions are 10.5% lower than yesterday and 9.4% weaker since last week. The clear forex crowd shift towards GBPUSD longs gives us contrarian signal to sell the currency pair.
USDJPY – The jump in forex crowd USDJPY buying gives us contrarian signal to sell into the pair’s declines. The ratio of long to short positions in the USDJPY stands at 1.71 as nearly 63% of traders are long. Yesterday, the ratio was at 1.30 as 57% of open positions were long. In detail, long positions are 9.8% higher than yesterday and 4.4% stronger since last week. Short positions are 16.5% lower than yesterday and 10.1% stronger since last week. The clear shift towards USDJPY buying has left our contrarian sentiment forex trading signals heavily short the currency pair.
USDCHF – Recently aggressive USDCHF buying has given our forex trading strategies contrarian signal to go short the currency pair. The ratio of long to short positions in the USDCHF stands at 2.95 as nearly 75% of traders are long. Yesterday, the ratio was at 3.60 as 78% of open positions were long. In detail, long positions are 19.0% lower than yesterday and an incredible 77.3% stronger since last week. Short positions are 1.2% lower than yesterday and 31.7% weaker since last week. The very recent drop in long orders gives us pause in our aggressively bearish bias, but longs continue to outnumber shorts by nearly 3:1—giving us contrarian bias to sell into USDCHF declines.
USDCAD – Sharp shifts in forex sentiment have given us a relatively mixed bias on the US Dollar/Canadian Dollar currency pair. The ratio of long to short positions in the USDCAD stands at 1.06 as nearly 51% of traders are long. Yesterday, the ratio was at 1.19 as 54% of open positions were long. In detail, long positions are 8.9% lower than yesterday and 11.6% stronger since last week. Short positions are 3.1% higher than yesterday and 3.8% weaker since last week. The net-long bias would normally give us a contrarian bias to sell into declines, but the overnight shift leaves us effectively neutral the recently-volatile currency pair.
How do we interpret the SSI? Read our brand-new Primer on the SSI.
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[B]Have any further questions about the SSI and forex positioning data? Ask the author David Rodríguez on our forex forum.
We love getting feedback on our reports. Tell us how we’re doing: E-mail the author of this report at <[email protected]>. [/B]