EUR/USD gaining long sentiment near 1.0800

Forex sentiment update

EUR/USD has lost close to 200 pips in the last week of trading, while sentiment around the major forex pair went from short to long. GBP/USD saw an even greater shift going from 67% short last week to 58% long at present, though the British pound did not see as much downside as the euro relative to the US dollar.

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Australian dollar and Japanese yen both moved back to lows against USD in what has seemingly become an overarching flight-to-quality for the US dollar. Could AUD/USD get back to 0.6200? Could USD/JPY return to 150.00?

EUR/USD historical prices

How client sentiment works

Client Sentiment shows the percentage of IG 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 IG'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 - 59% long

Last week's sentiment: 53% short

The tides have turned on EUR/USD prices and sentiment as the major pair has gone from above-1.1000 prices and overwhelmingly short sentiment just a few weeks ago to near 1.0800 and 59% long. Traders seem to be split around the 1.0900 level while divergences lower have resulted in longs and higher prices have resulted in shorts.

GBP/USD sentiment - 58% long

Last week's sentiment: 67% short

British pounds have witnessed one of the sharpest turns in sentiment of the major forex pairs of the last week going from 67% short to 58% long amid relatively little price action in GBP/USD. Sure, the pair fell from above 1.2600 to below 1.2500, but GBP/USD looks to be stronger than EUR/USD, relatively speaking; maybe that's part of the story for those traders going from short to long.

USD/CHF sentiment - 51% short

Last week's sentiment: 85% long

US dollars were able to bounce back against Swiss francs from the historical lows near 0.88000 closer to 0.9000. There is still plenty of ground for USD to make up if USD/CHF were to get back to average prices from last year, but the near-50/50 split shows traders are complacent at current prices.

USD/JPY sentiment - 56% long

Last week's sentiment: 56% short

In what has been a rough week of downside action for the Japanese yen against most major currencies, USD/JPY has actually gained long sentiment. In a semi-abnormal trend for IG clients, USD/JPY went from short to long as the pair strengthened from below 135.00 to above 137.00 (traders tend to go against the recent price action).

AUD/USD sentiment - 57% long

Last week's sentiment: 51% long

AUD/USD longs are starting to grow again as the market broke back down to 0.6600. Australian dollars continue to lose any flashes of bullish price action within just a week or two - last week, AUD/USD made it back to 0.6800 and looked poised for a potential new high in 2023. AUD/USD traders have been content trading the 0.6600-0.6800 range for now.

USD/CAD sentiment - 55% long

Last week's sentiment: 72% long

US dollars were able to rally back slightly against Canadian dollars in the last week, though USD lost steam the last few days. Traders are still 55% long USD/CAD, but most will be watching for a break in either direction outside the 1.3400-1.3600 range.