Australian Dollar Likely to Continue Lower

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Australian Dollar Likely to Continue Lower

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AUDUSD - The ratio of long to short positions in the AUDUSD stands at 3.31 as 77% of traders are long. Yesterday the ratio was 2.38; 70% of open positions were long. Long positions are 9.7% higher than yesterday and 12.4% above levels seen last week. Short positions are 21.2% lower than yesterday and 30.1% below levels seen last week. Open interest is 0.5% higher than yesterday and 0.5% below its monthly average. We use our SSI as a contrarian indicator to price action, and the fact that the majority of traders are long gives signal that the AUDUSD may continue lower. The trading crowd has grown further net-long from yesterday and last week. The combination of current sentiment and recent changes gives a further bearish trading bias.

See next currency section:NZDUSD - New Zealand Dollar Forecast Firmly in Favor of Depreciation

--- Written by David Rodriguez, Quantitative Strategist for DailyFX.com

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