Yen Rallies Giving Bearish Signal Based on Sentiment
USDJPY: Retail trader data shows 58.0% of traders are net-long with the ratio of traders long to short at 1.38 to 1. The percentage of traders net-long is now its highest since Apr 26 when USDJPY traded near 111.197. The number of traders net-long is 12.4% higher than yesterday and 10.0% higher from last week, while the number of traders net-short is 23.5% lower than yesterday and 24.5% lower from last week.
We typically take a contrarian view to crowd sentiment, and the fact traders are net-long suggests USDJPY prices may continue to fall. Traders are further net-long than yesterday and last week, and the combination of current sentiment and recent changes gives us a stronger USDJPY-bearish contrarian trading bias.
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