USD/JPY and GBP/JPY: retail trader sentiment signals potential reversals

• USD/JPY

Current retail trader data

The latest trader data paints a complex picture for USD/JPY (大口）. Current data shows a mere 17.15% of retail traders holding long positions, with short positions outnumbering long positions by nearly 5 to 1. Yet, beneath this bearish surface, currents of change are stirring.

USD/JPY client positioning chart

Rising long positions

Long positions are on the rise, climbing 16.84% day-over-day and 9.34% week-over-week. While our contrarian approach typically views net-short sentiment as a bullish signal, the recent reduction in bearish conviction hints at a potential trend reversal.

This evolving sentiment landscape offers valuable insights for strategic positioning in the USD/JPY (大口） market.

USD/JPY daily price chart

• GBP/JPY

Retail trader sentiment

Recent retail trader data reveals intriguing insights into the GBP/JPY currency pair. A mere 19.38% of traders are currently maintaining long positions, resulting in a short-to-long ratio of 4.16 to 1. This pronounced bearish sentiment among retail traders often serves as a contrarian indicator, suggesting the possibility of continued upward momentum for the GBP/JPY.

GBP/JPY client positioning chart

Temporal shifts in positioning

Temporal shifts in trader positioning add another layer of complexity to the market outlook. While the number of traders holding long positions has increased by 8.27% since yesterday, it has markedly decreased by 18.64% compared to last week. Conversely, short positions have seen growth both on a daily and weekly basis, at 6.39% and 3.63% respectively.

Mixed trading bias

This nuanced picture of trader sentiment and its recent fluctuations presents a mixed trading bias for the GBP/JPY. The overall net-short positioning has moderated since yesterday but intensified compared to last week, creating a delicate balance of market forces and highlighting a mixed trading bias.

GBP/JPY daily price chart

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