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USDCAD– A remarkable shift in retail forex trader positions warns that the US Dollar may continue lower versus the resurgent Canadian Dollar. Our data shows there are currently 1.3 open USD/CAD long positions for every 1 short, and a contrarian view of crowd sentiment leaves us in favor of selling into USD/CAD declines.
Indeed, last week we noted the likelihood that the US Dollar set a top versus its Canadian counterpart; the further flip in retail FX sentiment acts as further confirmation. We will maintain our bearish trading bias until further notice.
See next currency section: AUDUSD - Australian Dollar Outlook Uncertain until this Changes
Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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