Canadian Dollar Hits the Skids, Losses Likely
Why and how do we use the SSI in trading? View our video and download the free indicator here
USDCAD – A sharp move in Canadian Dollar positioning warns that the USD/CAD may have set an important short-term low. In the last three weeks we’ve admittedly said much the opposite as the pair rallied to fresh highs. Yet our retail FX trader data warns that the US Dollar may instead trade lower versus its Canadian counterpart.
Current positioning shows there are 1.3 open retail USD/CAD-short positions for every one that is long, and a contrarian view of crowd sentiment leaves us looking in the opposite direction. Indeed it was just seven days ago that the opposite was true—most were long. The abrupt turn warns of further near-term USD/CAD gains.
See next currency section: XAUUSD - Our Data Shows Gold Prices Likely to Continue Higher
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 for his distribution list via this link.
Contact David via
Twitter at http://www.twitter.com/DRodriguezFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.