Swiss Franc Forecast Remains Bearish
USDCHF – US Dollar/Swiss Franc sentiment remains fairly neutral as the pair consolidates following its recent correction. Last week we highlighted the fact that traders had remained heavily net-long the USDCHF since the pair traded near the 1.10 mark. Yet positioning flipped to net-short approximately 2 weeks ago, giving signal that the pair may have set a significant bottom through previous price action. Crowds have since flipped back to net-long territory, but near-neutral positioning gives us no strong short-term bias.
The ratio of long to short positions in the USDCHF stands at 1.34 as nearly 57% of traders are long. Said ratio is mostly unchanged since yesterday and last week, and we may need to wait for further sentiment extremes before taking stronger convictions in short-term USDCHF forecasts. The dramatic moderation in long positions over the past month nonetheless suggests the pair may have set a significant bottom.
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