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USDCHF–Retail FX traders are their most long the US Dollar against the Swiss Franc since it traded towards SFr 0.7000 in 2011—warning of a potential price and sentiment extreme.
Trade Implications – USDCHF: As with the Euro and British Pound, the fact that traders are so aggressively short the Swiss Franc suggests we might be at a potential top (USDCHF bottom).
The clear caveat is that major extremes and price lows/highs are only clear in hindsight. We’re keeping a close eye on sentiment and may wait until our SSI-based Momentum2 system heads in the opposite direction before getting long.
--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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