Forex Analysis:Steering Clear of AUDUSD Shorts
I wrote earlier this week in my forex strategy outlook report that I think that the US Dollar and Japanese Yen are both at risk for further weakness. And indeed, both remain in fairly steady downtrends against major counterparts.
In fact our Speculative Sentiment Index data shows there are 2.3 retail traders short AUDUSD for every one that is long. There are far too many looking to fight this uptrend for me to take part, and indeed I'll stand aside.
I remain in a small USDJPY long position--I took profits on the bulk of the position about 100 pips ago and was looking to buy dips. I would still like to buy dips, but the USDJPY is showing that it may not necessarily be willing to pull back in any material way. I'm willing to buy further if we hit the 81.60 mark, and I'll likewise trail risk on the entire position below the 79.00 mark.
I'll keep my thoughts posted via the forex real time news feed.
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com To receive the Speculative Sentiment Index and other reports from this author via e-mail, sign up to David’s e-mail distribution list via this link.
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