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2025-07-29 17:55:44
[Foreign Exchange Market Giants' Hidden Turn: Does Data Reveal the Calm Before the Dollar Storm?] ⑴ The current focus in the forex market is on traders cashing in on large-scale short dollar positions to take profits, a move that could support the dollar going forward. ⑵ A pullback from recent record highs would further reinforce this view, as strong equity markets have encouraged forex traders to increase risk-taking. ⑶ Increased investment appetite in financial markets amidst a bullish trend suggests that forex traders may rebuild their currently reduced short dollar positions. ⑷ While bets on the euro have increased, they have not yet reached the excessive levels that would signal a historic reversal. ⑸ Profit-taking is reducing long euro positions, easing their dampening effect on EUR/USD's gains this year and creating conditions for a subsequent rebound. ⑹ EUR/USD has reached the 38.2% Fibonacci retracement level of 1.1538 for the May-July rally, potentially forming the basis for a resumption of the uptrend and potentially forming a new bottom ahead of the May low of 1.1065. ⑺ The situation with USD/JPY is slightly different. Bets on the appreciation of the yen have reached a high proportion, indicating a larger correction. It has already retraced nearly half of its losses this year, and the correction may be nearing its end. ⑻ If enough yen longs take profits and USD/JPY fails to break through the 150 mark, traders are likely to choose to sell again.
