The Week Ahead: Retail Net Short USD, Further Gains Ahead?

Retail Traders last week started to position for weakness in the US Dollar and gains in the major crosses, closing out many of their short positions in favour of longs to the point that in some pairs we saw a switch from net short to net long.

This could point to some further US Dollar strength ahead, although we expect quieter trading to start to filter through as the holiday season starts. Due to the fourth of July we expect light volumes this week and more of the same trends we have been seeing recently.
EUR/USD
We currently hold short in this pair from 1.3150 mark, having previously closed our longs from 1.2910.
Some momentum gathered in the order book last week and although we expect a quiet and grinding style of trading this week, we could be on for some further weakness in the Euro with the 1.2780 mark not far below.

Daily chart is potentially also pointing to a price rejection of the 200 day SMA. Typically though in quiet markets we would expect this pair to grind higher, so it will be interesting to see some of the price action this week.

Intraday we like using the higher stochastic crosses to look for shorts.
GBP/USD
Pound continued its move lower last week clipping the 1.520 level.
We remain short this pair with a minor blip with a very short term long as the order book switched.
Order now however looks like shorts could continue with the net Retail Positioning now net long and last week that saw Retail Long positions increase.


Daily chart is starting to hint at two possible options, either we are chopping our way slightly higher in the long term or we are carving out a new lower range for the pair capped to the upper side by the 1.5700 level and 1.5000 below?




Intraday like the Euro we will looking for upper stochastic crosses to enter short, looking for bounces and the general grind higher to offer better value.

AUD/USD
Our Pin Bar Detector last week picked up a couple of nice shorts which played out well on Friday; this was mirrored by our order book systems which continue to play on short term timeframes due to the choppy nature of this pair.
Recent pattern in order book has been a slight grind lower, in order book positions closing out some longs. Then when we find some room at around the 70% long mark we get a spike in buying as we move lower back to the 80% long point.
If this continues we could easily see price move slightly lower, then grind higher only to drop again at some point.

This pair has further room to the downside and we could see this pair continue to drop. The drop would also be welcomed in Australia so they are unlikely to do too much about it until it's at a much lower level.
USD/CHF
Order book finally switched long this pair having been short from the 0.9700 mark.
We suspect we could see this pair retest the 200 day SMA before pushing higher.
Retail traders started closing out longs last week as we pushed higher, if this gathers some momentum we could see this pair push back to the 0.9700 mark again and potentially put in new highs.


Intraday we like playing the opposite to the EUR/USD and looking for long entries on lower Stochastic crosses
EUR/AUD
Order book has continued to remain at extreme levels in this pair the opposite to the AUD/USD positions.
Retail Traders incredibly short this pair and we see a very similar pattern to the Aussie. A slight move lower clears some orders we get some relief in the order book and then Retail Traders jump short and we push higher.
Order Book system has been doing well on this pair and switched to long at the 1.4000 mark last week having previously been short.

Daily chart looks could continue to push higher to may be looking to form some form of interim top here; however there is room to test the 1.4600 mark or higher.