USD/JPY Ratio: -1.10 Signal: Bullish
USDJPY – The steady yet reserved advance in USDJPY is supported by an equally reserved SSI reading. Speculative positioning shows nearly 52% of retail traders are short the pair, creating a ratio of -1.10. This is on par with the readings from over the past few weeks: last week reported a -1.26 and the number before that stood at -1.23. As a contrarian indicator, this sentiment gauge points to further gains; but the signal is relatively weak. From the USDJPY rally through last June, we can interpret a strong reading as being near or above -2.00. From the details, it seems retail traders are starting to turn into the pair’s steady advance. Long positions grew 5.1% from Wednesday and have risen 12.3% on the week. Shorts on the other hand slipped 1.2% since yesterday and are 8.7% weaker than last Thursday. On the whole, total open interest is 2.7% greater than last week’s levels and 5.7% above the monthly average.