Canadian Dollar, Australian Dollar, Dow Jones Outlook – Positioning Bets

INVESTOR POSITIONING, USD/CAD, AUD/USD, DOW JONES – KEY POINTS:

  • Discussion about technical analysis to highlight the key challenges ahead
  • Will USD/CAD & AUD/USD follow IGCS or stocks?
  • The Dow Jones might fall based on the positioning signals
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In these weeks’ earlier posts, we strongly discussed the IG Client Sentiment or IGCS; we further highlighted the outlook of the Dow Jones and also highlighted the trajectory for a growth-linked Canadian dollar and Australian dollar. Essentially, the IGCS is largely seen as the contrarian indicator. Moreover, the more comprehensive outlook that branches in the fundamental assessment.

Dow Jones Bearish Sentiment Outlook

The IGCS shows that 43% of Dow Jones investors are undoubtedly net long. Technically, over the past day, the net short forecast bets have reduced by 6.41%, a more decline as compared to the 9.47% decline over the past week. The latest adjustments in the sentiments are a warning that today’s wall street price trends might soon start reversing lower despite the notion that investors remain net-short. Essentially, from a key psychological perspective, this means there is an increased share of traders trying to select the next top.

Dow Jones Technical Analysis

Dow Jones futures might start to struggle to find an additional upside trend as the prices continue to struggle to nudge over immediate resistance. Technically speaking, this will be a range from 26193 to 26658. At the same time, the nudge over near term falling resistance that started back in June paints a thoughtfully upside bias. 50-day simple MA is immediately under which can stop detailed selling pressure.

Dow Jones Futures Chart

Dow-Jones-Australian-Dollar

AUD/USD BULLISH SENTIMENT OUTLOOK

The IG Client Sentiment measurement suggests that about 31.51% of the retail traders are AUD/USD net long. On the other hand, the downside exposure has reduced by about 3.41% every day, even though simultaneously surging 19.62% from the previous week. Also, the net long bets are further down 7.97% within the same timeline. A combination of the recent changes and the current sentiment generates a much powerful bullish contrarian trade bias.

AUD Technical Analysis

The AUD/USD has so far attempted to find asset upside progress after nudging over the near term fall resistance from the previous month’s pink line. The Australian paused some recent gains on the resistance at about 0.7032. The resumption of this prevailing upside from March includes taking out between 0.7015 and 0.7064 that can open doors to testing the July 2019 highs.

AUD/USD Chart

Dow-Jones-Australian-Dollar

USD/CAD BEARISH SENTIMENT OUTLOOK

The IG Client Sentiment gauge suggests that about 59.04% of investors are USD/CAD net long. The net short positioning has reduced further over a day and week basis by 16.12% and 0.77% respectively. At the same time, the net long bets have gone up by 7.77% and 14.20% over a day and week basis respectively. A combination of the recent changes and current sentiment gives a powerful bearish contrarian trade bias.

CAD Technical Analysis

On the following chart, the USD/CAD tests the critical falling resistance from March highs – red line. As a result, this can reinstate the prevailing downside, as prices seem to clear key support under 1.3486 to 1.3521.

USD/CAD Chart

Dow-Jones-Australian-Dollar

Also read through our article about USD/CAD Pulls Back Towards 1.3540 After US Non-Farm Payrolls.

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