Loonie Forecast Warns Against Chasing Strength
USDCAD – Retail trading crowds remain aggressively long the US Dollar (ticker: USDOLLAR) against the Canadian Dollar, but a noteworthy drop in long interest gives us pause in our earlier calls for USDCAD declines.
FXCM Execution Desk data shows there are currently 2.9 retail traders long USDCAD for every one that is short. Sentiment is clearly one-sided, but crowds have actually pulled back from recent peaks near 5.5 traders long for each short.
As with other USD pairs, we see further US Dollar/Canadian Dollar consolidation amidst extremely slow market conditions.
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--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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