Forex

Similar to the euro-based major, GBPUSD price action is being guided by a highly visible technical range - and retail traders are proving themselves adept at taking advantage of the clear levels. With the most recent touch of a major descending trend now near 1.9750, the pair’s Sentiment gauge has seen a notable skew towards the short side of the market. The ratio stands at -1.66 with nearly 62% of the retail market short. This compares to the -1.71 reading from last week when spot happened to be testing the same level. The indicator’s details show that despite the modest change in the ratio, there has actually been significant volatility in positioning. From yesterday, longs have dropped 10%, which has led to a 20.5% week-over-week contraction. For those looking for sustained range conditions, shorts have grown only 3.9% from yesterday but are a significant 27.9% higher than last week. Open interest slipped 6.2% from last week, but is still 4.9% above the monthly average.

* EURUSD – Euro SSI Flips As 1.5300 Support Maintains A Wide Range
* GBPUSD – Speculative Short Pound Interest High As Traders Bet On The Range
* USDJPY – USDJPY Sentiment Points To Further Upside, Though Momentum Fading
* USDCHF – SSI Suggests The Window For An Upside USDCHF Breakout Is Closing
* USDCAD – Positive Interest Among Retail Traders Solidifies USDCAD Range


EURUSD


Since EURUSD yielded to very public support seen around 1.5300 two weeks ago, positioning among the retail group has quickly turned against the developing move. Typically good range traders, the speculative community is still prone to common trading mistakes – such as setting stops too close and taking profit too early. This may be a contributing factor behind the flip in the EURUSD’s Speculative Sentiment Index ratio this week. The positioning gauge stood at -1.52 with nearly 60% of traders holding short positions. This figure stands in stark contrast to the 1.34 reading of last week and 1.50 from two Thursday’s ago. Such a shift in positioning reflects the retail crowd’s attempts at finding a nearby range top. The report’s details show a relatively uniform market flip. Long positions dropped 20.6% from yesterday and are 23% below last week’s levels. On the other side of the trade, shorts have grown 16.9% over the past 24 hours and risen 20% since last week. Open interest further suggests the opportunity at trading a broad range has kept most retail traders in the market as they merely reverse their positions when technicals come into view. Net positioning was only 0.5% higher than last week and 2.5% above the monthly average. Though the SSI’s effectiveness ebbs when the market holds to clear ranges, the EURUSD sentiment indicator points to further gains within the limits of the broad technical formation.


GBPUSD


Similar to the euro-based major, GBPUSD price action is being guided by a highly visible technical range - and retail traders are proving themselves adept at taking advantage of the clear levels. With the most recent touch of a major descending trend now near 1.9750, the pair’s Sentiment gauge has seen a notable skew towards the short side of the market. The ratio stands at -1.66 with nearly 62% of the retail market short. This compares to the -1.71 reading from last week when spot happened to be testing the same level. The indicator’s details show that despite the modest change in the ratio, there has actually been significant volatility in positioning. From yesterday, longs have dropped 10%, which has led to a 20.5% week-over-week contraction. For those looking for sustained range conditions, shorts have grown only 3.9% from yesterday but are a significant 27.9% higher than last week. Open interest slipped 6.2% from last week, but is still 4.9% above the monthly average.



USDJPY


Two month’s of relatively consistent short-side positioning from the retail sector has served the USDJPY SSI well. However, the contrarian reading suggests the bullish run is losing its momentum. This week, the pair’s speculative positioning index stands at -1.48 with 60% of the survey pool holding short positions. And, though this is still a relatively acute short-side reading, it maintains a steady move towards parity following the -1.66 print from last week and -1.93 of two weeks ago. Not only has the steady decline in the USDJPY index’s extreme matched the fading momentum in the underlying pair, but trading activity within the sentiment sector has similarly cooled. Traders increased their long holdings by only 2.5% over the past 24 hours, and a modest 1.3% from last week. On the other side of the market, shorts have edged off 0.2% from yesterday and slipped 2.3% from the same period a week ago. Overall, net positioning fell 5.3% form last week, but open interest is still 2.3% above the monthly average.