USDCAD - Sentiment Index Calls for More USD/CAD Losses. Is Parity Possible?
EURUSD - Retail Positioning Grows More Net Short
USDJPY - Short Positions Are 7 percent Stronger Than Last Week
GBPUSD - Speculative Positioning Remains Close to Parity
USDCHF - Sentiment Grows More Net Long Confirming the EURUSD ratio
How to Interpret the SSI? The FXCM SSI is based on proprietary customer flow information and is designed to recognize price trend breaks and reversals in the four most popularly traded currency pairs. The absolute number of the ratio itself represents the amount by which longs exceed shorts or vice versa. For example if the EURUSD ratio is 2.55, long customer orders exceed short orders by a ratio of 2.55 to 1. Conceptually similar to contrarian analyses using the CFTC IMM open position data or COT Report, the SSI provides an alternative approach that is both more timely and accurate in forecasting currency price movement. The SSI is a contrarian indicator that tells you how the market is weighted and where the trend may head. More long positions don’t necessary suggest more confidence in the direction of the current trend. In general, when traders start having adverse movements against their position, many tend to increase the size of their position with the purpose to average down their entry price in one last attempt to recover from previous losses. However, the higher the number of short orders in a bull market the more dangerous is to take additional shorts because many of those traders who just entered the markets are also leaving their protective stop losses just above the current price action.
EURUSD - The ratio of long to short positions in the EURUSD stands at -1.59 as nearly 61% of traders are short. Yesterday, the ratio was at -1.17 as 54% of open positions were short. In detail, long positions are 16.5% lower than yesterday and 12.9% weaker since last week. Short positions are 13.3% higher than yesterday and 14.0% stronger since last week. Open interest is 0.4% weaker than yesterday and 1.0% above its monthly average. The SSI is a contrarian indicator and signals more EURUSD gains.
GBPUSD - The ratio of long to short positions in the GBPUSD stands at 1.02 as nearly 50% of traders is long. Yesterday, the ratio was at 1.17 as 54% of open positions were long. In detail, long positions are 2.3% lower than yesterday and 33.2% stronger since last week. Short positions are 12.1% higher than yesterday and 14.7% weaker since last week. Open interest is 4.3% stronger than yesterday and 6.7% above its monthly average. The SSI is a contrarian indicator but the SSI is too close to parity to call for any future direction.
USDCHF - The ratio of long to short positions in the USDCHF stands at 2.62 as nearly 72% of traders is long. Yesterday, the ratio was at 2.80 as 74% of open positions were long. In detail, long positions are 2.5% lower than yesterday and 7.5% stronger since last week. Short positions are 3.9% higher than yesterday and 15.1% weaker since last week. Open interest is 0.8% weaker than yesterday and 6.9% below its monthly average. The SSI is a contrarian indicator and signals more USDCHF losses.
USDJPY - The ratio of long to short positions in the USDJPY stands at -1.92 as nearly 66% of traders are short. Yesterday, the ratio was at -1.97 as 66% of open positions were short. In detail, long positions are 1.0% higher than yesterday and 10.8% weaker since last week. Short positions are 1.4% lower than yesterday and 7.0% stronger since last week. Open interest is 0.6% weaker than yesterday and 7.4% above its monthly average. The SSI is a contrarian indicator and signals more USDJPY gains.
USDCAD - The ratio of long to short positions in the USDCAD stands at 4.89 as nearly 83% of traders is long. Yesterday, the ratio was at 4.56 as 82% of open positions were long. In detail, long positions are 7.1% higher than yesterday and 6.2% stronger since last week. Short positions are 0.1% lower than yesterday and 34.4% stronger since last week. Open interest is 5.8% stronger than yesterday and 25.2% above its monthly average. The SSI is a contrarian indicator and signals more USDCAD losses.
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