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Recent shifts in retail FX sentiment increasingly point to a US Dollar reversal, and in fact the SSI is now giving a fairly clear signal to go short the Euro versus its US counterpart. Earlier this week, we pointed to extreme FX Futures and Options markets positioning and argued that the US Dollar set an important bottom on one-sided positioning. Though it is clearly premature to definitively say that the USD has set a base, strong shifts in crowd sentiment add further conviction to our call. In fact, long open interest in the EURUSD jumped 27% overnight while short open interest dropped 15%. This gives us fairly clear signal to go short EURUSD, and indeed one of our algorithmic SSI-based trading systems remains short from 1.4695.
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