AUD/USD gaining long sentiment below 0.6600
Midway through the trading week, we update Client Sentiment levels - percentage of tastyfx clients with long or short positions - for major forex pairs like EUR/USD, USD/JPY, and more. Find out what traders are thinking this week.
Forex sentiment update
This week's decision to hold interest rates from the Reserve Bank of Australia has led to weakness in the Australian dollar. AUD/USD is over 200 pips lower than last Wednesday's close - traders are anticipating a reversion as long sentiment grows.
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US dollar strength in all six of the below pairs has shaken up client sentiment across the board this week - EUR/USD sentiment flipping in favor of the euro after recent price action.
How client sentiment works
Client Sentiment shows the percentage of tastyfx client accounts with open positions that are currently long or short. If the majority of client accounts with open positions are long a given market, then they expect the price to rise; if the majority is short, then they expect it to fall. (Values taken using tastyfx's Client Sentiment measure as of the previous day's close.)
Trend followers might go with sentiment, while contrarians would tend to go against the trend. For example, a 65% long measure in EUR/USD could reflect a buying opportunity for trend followers or a selling opportunity for contrarians.
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EUR/USD sentiment - 56% long
Last week's sentiment: 55% short
Euro sentiment flips long as the pair dips below 1.1000 once again. The pair has spent more time below 1.1000 in 2023 than above - yet more traders anticipate future euro strength.
GBP/USD sentiment - 58% long
Last week's sentiment: 51% long
British pound sentiment grows ahead of the BoE's interest rate decision. GBP/USD has been trending lower - trading under 1.2700 for the first time in almost a month.
USD/JPY sentiment - 70% short
Last week's sentiment: 60% short
This week's rally in USD/JPY leads more traders to take short positions. The pair has moved over 500 pips from last Friday's lows.
USD/CHF sentiment - 82% long
Last week's sentiment: 87% long
USD/CHF is trading above July's historic lows this week. Although less traders are long the pair, an overwhelming majority still believe in the US dollar upside.
AUD/USD sentiment - 81% long
Last week's sentiment: 62% long
Australian dollar sentiment has grown 18% in the past week after the pair shot down below 0.6600. Though not yet to 2023 lows, the lowest price since June 1st is enough for over eight out of ten traders to think AUD/USD will rise.
USD/CAD sentiment - 54% long
Last week's sentiment: 59% long
The US dollar is gaining on CAD, trading near 1.3350. Traders will likely monitor the pair Friday as both countries report employment data.
How to trade client sentiment
- Open an account to get started, or practice on a demo account
- Choose your forex trading platform
- Open, monitor, and close positions on forex pairs
Trading forex requires an account with a forex provider like tastyfx. Many traders also watch major forex pairs like EUR/USD and USD/JPY for potential opportunities based on economic events such as inflation releases or interest rate decisions. Economic events can produce more volatility for forex pairs, which can mean greater potential profits and losses as risks can increase at these times.
You can help develop your forex trading strategies using resources like tastyfx’s YouTube channel. Once your strategy is developed, you can follow the above steps to opening an account and getting started trading forex.
Your profit or loss is calculated according to your full position size. Leverage will magnify both your profits and losses. It’s important to manage your risks carefully as losses can exceed your deposit. Ensure you understand the risks and benefits associated with trading leveraged products before you start trading with them. Trade using money you’re comfortable losing.
This information has been prepared by tastyfx, a trading name of tastyfx LLC. This material does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. You should not treat any opinion expressed in this material as a specific inducement to make any investment or follow any strategy, but only as an expression of opinion. This material does not consider your investment objectives, financial situation or needs and is not intended as recommendations appropriate for you. No representation or warranty is given as to the accuracy or completeness of the above information. tastyfx accepts no responsibility for any use that may be made of these comments and for any consequences that result. See our Summary Conflicts Policy, available on our website.
