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Australian Dollar Forecast to Continue Higher versus US Dollar

Australian Dollar Forecast to Continue Higher versus US Dollar

David Rodriguez, Head of Product

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Why and how do we use IG Client Sentiment in trading? See our guide and real-time data.

AUDUSD: Retail trader data shows 27.3% of traders are net-long with the ratio of traders short to long at 2.66 to 1. In fact, traders have remained net-short since Jun 04 when AUDUSD traded near 0.74387; price has moved 6.6% higher since then. The number of traders net-long is 14.1% higher than yesterday and 10.6% higher from last week, while the number of traders net-short is 2.5% higher than yesterday and 5.8% lower from last week.

We typically take a contrarian view to crowd sentiment, and the fact traders are net-short suggests AUDUSD prices may continue to rise. Yet traders are less net-short than yesterday and compared with last week. We will take a cautiously bullish contrarian trading bias for the AUDUSD until we see more sustained signs of a turnaround in sentiment.

See next article in this week’s report: S&P 500 - Remains a Buy until this Changes

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

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