Japanese Yen Outlook Clouded by Recent Shift
USDJPY – Forex trading crowd positioning has remained heavily net-long since the pair traded above 90, giving consistent contrarian signal to sell into USDJPY weakness. Yet a more recent moderation in long interest waters down our overall USDJPY-bearish forecasts.
The ratio of long to short positions in the USDJPY stands at 2.94 as nearly 75% of traders are long. Yesterday, the ratio was at 3.79 as 79% of open positions were long. Long positions dropped a notable 9.2 percent overnight and 15.7 percent since last week. Short positions have bounced significantly at 17.0 percent higher than yesterday but effectively unchanged in the past 7 days. Though trading crowds remain heavily net-long and SSI typically gives contrarian signal to watch for losses, the sharp jump in short interest moderates our longer-term bearish bias.
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