Crowds Sell Dollar versus Yen, Gives Contrarian Buy Signal
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USDJPY - The ratio of long to short positions in the USDJPY stands at 1.42 as 59% of traders are long. Yesterday the ratio was 1.65; 62% of open positions were long. Long positions are 7.6% lower than yesterday and 5.1% below levels seen last week. Short positions are 6.7% higher than yesterday and 19.5% above levels seen last week. Open interest is 2.2% lower than yesterday and 2.0% below its monthly average. We use our SSI as a contrarian indicator to price action, and the fact that traders have sold into recent gains gives us a modestly bullish trading bias.
See next currency section:AUDUSD - Australian Dollar at Potential Turning Point
Written by David Rodriguez, Quantitative Strategist for DailyFX.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.