FOREX ANALYSIS: Australian Dollar Likely Topped

ssi_gbp-jpy_body_Picture_1.png, FOREX ANALYSIS: Australian Dollar Likely Topped

AUDUSD – Retail forex traders are now net-long the Australian Dollar versus the US Dollar (ticker: USDOLLAR) for the first time in a month, and the sharp shift in retail sentiment warns that the AUDUSD may have set a significant top through recent trading.

A sharp Australian Dollar sell-off from the November high was the first signal that the AUD may have set a significant peak, and we’ve likewise seen the number of retail traders long AUDUSD surge 32 percent since the peak. A similar 28 percent tumble in the number of traders short now leaves crowds at a net-long AUD position for the first time since October.

We use our proprietary Speculative Sentiment Index data as a contrarian indicator to price action; if the majority of traders are buying, we prefer to sell. Indeed, our retail sentiment-based FX trading strategies took a AUDUSD short from $1.0378.

--- 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.
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MARKET MOVERS

  • Most Actives
    Most Actives
    NamePriceChange% Chg
    0.1720.0000.00%
    N21.SI
    0.850.00-0.58%
    Y92.SI
    0.4150.0000.00%
    5ME.SI
    0.180.00-1.10%
    40E.SI
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    % Gainers
    NamePriceChange% Chg
    0.27+0.04+17.39%
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    BLZ.SI
    0.162+0.012+8.00%
    5MQ.SI
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    S46.SI
    0.25+0.02+6.38%
    BTM.SI
  • % Losers
    % Losers
    NamePriceChange% Chg
    0.34-0.10-22.73%
    AWC.SI
    0.375-0.095-20.21%
    BLL.SI
    0.09-0.01-11.76%
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    USDSGD=X
    1.5242+0.0022+0.14%
    EURSGD=X
    1.7735+0.0144+0.82%
    GBPSGD=X
    79.6880-0.479-0.60%
    SGDJPY=X
    5.4654+0.0264+0.49%
    SGDHKD=X
    3.1276+0.0097+0.31%
    SGDMYR=X
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    SGDCNY=X
    1.0743-0.0016-0.15%
    AUDSGD=X
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