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SSI: ECB's Hint of June Action Grants Covering Chance for EUR/USD Shorts

SSI: ECB's Hint of June Action Grants Covering Chance for EUR/USD Shorts

Christopher Vecchio, CFA, Senior Strategist

FXCM Speculative Sentiment Index (SSI) Statistics:

SSI: ECB's Hint of June Action Grants Covering Chance for EUR/USD Shorts

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SSI: ECB's Hint of June Action Grants Covering Chance for EUR/USD Shorts

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Currency Spotlight:

SSI: ECB's Hint of June Action Grants Covering Chance for EUR/USD Shorts

EURUSD - The ratio of long to short positions in the EURUSD stands at -3.61 as 22% of traders are long. Yesterday the ratio was -5.01; 17% of open positions were long. Long positions are 16.0% higher than yesterday and 10.7% above levels seen last week. Short positions are 16.3% lower than yesterday and 11.2% below levels seen last week. Open interest is 10.9% lower than yesterday and 2.9% below its monthly average. We use our SSI as a contrarian indicator to price action, and the fact that the majority of traders are short gives signal that the EURUSD may continue higher. The trading crowd has grown less net-short from yesterday and last week. The combination of current sentiment and recent changes gives a further mixed trading bias.

SSI: ECB's Hint of June Action Grants Covering Chance for EUR/USD Shorts

GBPUSD - The ratio of long to short positions in the GBPUSD stands at -5.07 as 16% of traders are long. Yesterday the ratio was -5.17; 16% of open positions were long. Long positions are 1.4% lower than yesterday and 0.3% above levels seen last week. Short positions are 3.2% lower than yesterday and 5.1% above levels seen last week. Open interest is 2.9% lower than yesterday and 22.1% above its monthly average. We use our SSI as a contrarian indicator to price action, and the fact that the majority of traders are short gives signal that the GBPUSD may continue higher. The trading crowd has grown less net-short from yesterday but further short since last week. The combination of current sentiment and recent changes gives a further mixed trading bias.

SSI: ECB's Hint of June Action Grants Covering Chance for EUR/USD Shorts

GBPJPY - The ratio of long to short positions in the GBPJPY stands at -1.48 as 40% of traders are long. Yesterday the ratio was -1.64; 38% of open positions were long. Long positions are 7.9% higher than yesterday and 9.3% above levels seen last week. Short positions are 3.0% lower than yesterday and 21.7% below levels seen last week. Open interest is 1.1% higher than yesterday and 4.9% below its monthly average. We use our SSI as a contrarian indicator to price action, and the fact that the majority of traders are short gives signal that the GBPJPY may continue higher. The trading crowd has grown less net-short from yesterday and last week. The combination of current sentiment and recent changes gives a further mixed trading bias.

SSI: ECB's Hint of June Action Grants Covering Chance for EUR/USD Shorts

USDJPY - The ratio of long to short positions in the USDJPY stands at 2.48 as 71% of traders are long. Yesterday the ratio was 2.57; 72% of open positions were long. Long positions are 0.6% higher than yesterday and 25.2% above levels seen last week. Short positions are 4.1% higher than yesterday and 4.9% below levels seen last week. Open interest is 1.6% higher than yesterday and 9.3% above its monthly average. We use our SSI as a contrarian indicator to price action, and the fact that the majority of traders are long gives signal that the USDJPY may continue lower. The trading crowd has grown less net-long from yesterday but further long since last week. The combination of current sentiment and recent changes gives a further mixed trading bias.

SSI: ECB's Hint of June Action Grants Covering Chance for EUR/USD Shorts

USDCHF - The ratio of long to short positions in the USDCHF stands at 4.22 as 81% of traders are long. Yesterday the ratio was 4.66; 82% of open positions were long. Long positions are 12.9% lower than yesterday and 8.2% below levels seen last week. Short positions are 3.9% lower than yesterday and 1.7% below levels seen last week. Open interest is 11.3% lower than yesterday and 0.1% below its monthly average. We use our SSI as a contrarian indicator to price action, and the fact that the majority of traders are long gives signal that the USDCHF may continue lower. The trading crowd has grown less net-long from yesterday and last week. The combination of current sentiment and recent changes gives a further mixed trading bias.

SSI: ECB's Hint of June Action Grants Covering Chance for EUR/USD Shorts

USDCAD - The ratio of long to short positions in the USDCAD stands at 1.58 as 61% of traders are long. Yesterday the ratio was 1.53; 61% of open positions were long. Long positions are 4.3% higher than yesterday and 35.9% above levels seen last week. Short positions are 0.9% higher than yesterday and 4.8% below levels seen last week. Open interest is 2.9% higher than yesterday and 10.6% above its monthly average. We use our SSI as a contrarian indicator to price action, and the fact that the majority of traders are long gives signal that the USDCAD may continue lower. The trading crowd has grown further net-long from yesterday and last week. The combination of current sentiment and recent changes gives a further bearish trading bias.

SSI: ECB's Hint of June Action Grants Covering Chance for EUR/USD Shorts

AUDUSD - The ratio of long to short positions in the AUDUSD stands at 1.10 as 52% of traders are long. Yesterday the ratio was 1.25; 56% of open positions were long. Long positions are 10.2% lower than yesterday and 10.7% below levels seen last week. Short positions are 2.0% higher than yesterday and 1.0% above levels seen last week. Open interest is 4.7% lower than yesterday and 5.0% below its monthly average. We use our SSI as a contrarian indicator to price action, and the fact that the majority of traders are long gives signal that the AUDUSD may continue lower. The trading crowd has grown less net-long from yesterday and last week. The combination of current sentiment and recent changes gives a further mixed trading bias.

SSI: ECB's Hint of June Action Grants Covering Chance for EUR/USD Shorts

NZDUSD - The ratio of long to short positions in the NZDUSD stands at -1.80 as 36% of traders are long. Yesterday the ratio was -2.64; 27% of open positions were long. Long positions are 10.4% higher than yesterday and 2.8% below levels seen last week. Short positions are 24.6% lower than yesterday and 1.1% below levels seen last week. Open interest is 15.0% lower than yesterday and 7.3% below its monthly average. We use our SSI as a contrarian indicator to price action, and the fact that the majority of traders are short gives signal that the NZDUSD may continue higher. The trading crowd has grown less net-short from yesterday but further short since last week. The combination of current sentiment and recent changes gives a further mixed trading bias.

SSI: ECB's Hint of June Action Grants Covering Chance for EUR/USD Shorts

EURCHF - The ratio of long to short positions in the EURCHF stands at 16.44 as 94% of traders are long. Yesterday the ratio was 16.66; 94% of open positions were long. Long positions are 2.7% higher than yesterday and 9.7% above levels seen last week. Short positions are 4.0% higher than yesterday and 12.7% below levels seen last week. Open interest is 2.7% higher than yesterday and 4.0% above its monthly average. We use our SSI as a contrarian indicator to price action, and the fact that the majority of traders are long gives signal that the EURCHF may continue lower. The trading crowd has grown less net-long from yesterday but further long since last week. The combination of current sentiment and recent changes gives a further mixed trading bias.

SSI: ECB's Hint of June Action Grants Covering Chance for EUR/USD Shorts

XAUUSD - The ratio of long to short positions in the XAUUSD stands at 1.59 as 61% of traders are long. Yesterday the ratio was 1.55; 61% of open positions were long. Long positions are 2.2% higher than yesterday and 5.2% below levels seen last week. Short positions are 0.4% lower than yesterday and 12.8% above levels seen last week. Open interest is 1.2% higher than yesterday and 3.0% above its monthly average. We use our SSI as a contrarian indicator to price action, and the fact that the majority of traders are long gives signal that the XAUUSD may continue lower. The trading crowd has grown further net-long from yesterday but moderated since last week. The combination of current sentiment and recent changes gives a further mixed trading bias.

SSI: ECB's Hint of June Action Grants Covering Chance for EUR/USD Shorts

SPX500 - The ratio of long to short positions in the SPX500 stands at -5.09 as 16% of traders are long. Yesterday the ratio was -3.13; 24% of open positions were long. Long positions are 26.9% lower than yesterday and 0.7% below levels seen last week. Short positions are 19.0% higher than yesterday and 7.1% below levels seen last week. Open interest is 7.9% higher than yesterday and 8.4% above its monthly average. We use our SSI as a contrarian indicator to price action, and the fact that the majority of traders are short gives signal that the SPX500 may continue higher. The trading crowd has grown further net-short from yesterday but moderated since last week. The combination of current sentiment and recent changes gives a further mixed trading bias.

SSI: ECB's Hint of June Action Grants Covering Chance for EUR/USD Shorts

EURJPY - The ratio of long to short positions in the EURJPY stands at 1.06 as 52% of traders are long. Yesterday the ratio was -1.23; 45% of open positions were long. Long positions are 17.6% higher than yesterday and 19.9% above levels seen last week. Short positions are 9.7% lower than yesterday and 13.1% below levels seen last week. Open interest is 2.6% higher than yesterday and 0.1% below its monthly average. We use our SSI as a contrarian indicator to price action, and the fact that the majority of traders are long gives signal that the EURJPY may continue lower. The trading crowd has flipped from net-short to net-long from yesterday and last week. The combination of current sentiment and recent changes gives a further bearish trading bias.

How do we interpret the SSI? Watch an FXCM Expo Presentation that explains the SSI.

--- Written by Christopher Vecchio, Currency Analyst

To contact Christopher Vecchio, e-mail cvecchio@dailyfx.com

Follow him on Twitter at @CVecchioFX

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

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