Most pairs are currently having a breather in the neutral zone, with GBPUSD and EURUSD pulling back from the strong long zone we were in a few days ago. EURCHF despite a strong pullback is still hanging on in the short zone, CHF CPI at 3:15am EST could have an impact on this. The big news events of the day effect the AUD with a speech by RBA Gov Stevens and Employment Change/Rate at 7:30pm EST.
EURUSD remains in its uptrend, however we are seeing a rather large sentiment shift in retail positioning with the EURUSD very close to Neutral territory after a spell in the strong long zone, GBPUSD is now also in the Neutral zone. Key news events that could have an impact on positioning are CAD Housing Starts released at 8:15 EST, and also tentatively timed is a speech by BOE Gov King.
EURUSD continues its consistent medium term uptrend at the same time retail traders are consistently increasing their short position to 65.97%. The big news event of the day is CAD Building Permits 08:30 EST other than that Trichet speaks at 07:00 EST, most other events of the day are relatively minor in historical effect.
GBPUSD continues to remain in the strong zone, consistently moving higher with 67% of traders short the pair, EURUSD is painting a very similar picture. Retail trader positioning still remains fairly extreme with most retailers LONG the USD. Action over the last few weeks has been very much contrary to that opinion. The Euro Rate Decision 7:45am EST and ECB Press conference 8:30am EST often have dramatic impacts on the EUR, it will vital to keep an eye on these developments
No major changes in terms of retail positioning today. There are some news events today that could lead to shifts in the positioning. Firstly out of the UK Construction PMI at 04:30 EST, US ADP Non-Farm follows at 08:15 this report has increased in importance over the years and is used as a guide for the big Non-Farm event. Bernanke will be testifying at 10:00 EST, later in the day at 19:30 EST market moving news from Australia with Building Approvals and Trade Balance released.
This morning ahead of the London session we're seeing some strong shifts in retail positioning, USDCAD, USDCHF and USDJPY have been in the strong short zone for a long while, with an unbelievable 80%+ or traders long while these pairs have been consistently selling off! On the flip side of this coin AUDUSD has entered the long zone with 61% of traders short as it nears multi year highs! GBPUSD has been consistently making higher highs and is now kissing a major resistance area at the same time 71% of traders are short this pair!
A slew of potentially market moving and thus retail position moving events today, EUR CPI is released at 05:00 EST, CAD GDP at 08:30 EST (big mover), 09:45 and 10:00 are the USD Chicago PMI and Pending Home Sales respectively, at 19:30 AUD Retail Sales is likely to cause a splash. EURCHF firms its position in the short zone, at the same time GBPUSD and EURUSD slip a little in strength, but GBPUSD still remains in the long zone.
The big news event of the day is the US GDP 10:00 EST expected to come in at 3.3% a deviation of 0.1% or more could lead to some significant changes in trader positioning, we also have UK Revised GDP coming out at 04:30 EST which is also often a big mover. In yesterdays session we saw overall GBP weakness. As a result GBPUSD has slipped from the strong long zone back into the long zone
Increasing market volatility is leading to more decisive trading action by traders, with the number of pairs now in the neutral zone at a 3 month low. There are a couple of market moving events today that could have a strong influence on the report heading into the weekend. At 08:30 EST we have US Durable Goods Sales followed by New Home Sales at 10:00, both events have the potential to cause shifts in retail trader positioning.
EURCHF reverted back into the short zone in yesterdays session, today we have CHF PPI at 03:15 EST which is likely to have an effect on this positioning. After some strong selling in the early part of yesterdays session a recovery ensued in EURUSD, the pair is now in the long zone.
GBPUSD has become firmly entrenched in the Strong Long zone, at the time of writing this we're seeing GBPUSD pull back from the highs, the bias for this pair does however remain to the long side overall. We have some market moving events including UK Public Sector Net Borrowing at 04:30 EST and US Consumer Confidence at 10:00 that could potentially add some spark.
Not much in terms of changes in retail trader positioning from yesterday. Some potentially market moving events today with Retail Sales out of the UK and speeches from Fed chair Ben Bernanke and BOE Gov at 8:00 EST and 8:20 EST respectively.
UK Inflation data led to market expectations of a potential rate hike, however this opinion quickly lost steam as Governor King spoke yesterday. Economic weakness indicated by a rising jobless rate, as well as other factors vs Inflation risks is leading to a continued stalemate in interest rate expectations. These event led to a sharp turn around in GBP positioning with most GBP pairs in the neutral zone now.
Increasing Inflation levels in the UK have led to strength in the GBP with analysts increasing the probability of an interest rate rise later in the year. Retail positioning however is quite contrary to this with increased short positions against the EUR, JPY and USD.
Today we have a plethora of major news events that could effect retail positioning dramatically. With German GDP, UK CPI, German ZEW, USD Retail Sales and US TIC coming out today all within a 8 hour window, any major deviations could have powerful implications. Going into the news events the report is fairly settled with most pairs in the neutral zone. GBPUSD has slipped a tiny bit back in the Long zone, with GBPJPY back in the neutral zone.
