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AUD/USD, S&P 500, Dow Jones Outlook Mixed After Recent Gains

AUD/USD, S&P 500, Dow Jones Trader Positioning – Talking Points

  • IG Client Sentiment offers mixed AUD/USD, S&P 500, Dow Jones outlook
  • All three are attempting key technical breaks higher, what are roadblocks?

In this week’s webinar on IG Client Sentiment (IGCS), I discussed the outlook for the AUD/USD, S&P 500 and Dow Jones. IGCS is a contrarian indicator. For a deeper dive into what this means and for fundamental analysis, check out the recording of the session above where I also outlined the road ahead for GBP/USD starting around the 29-minute mark.

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AUD/USD Sentiment Outlook – Mixed

The IGCS gauge implies that about 53% of retail investors are net long AUD/USD. Those with upside exposure have decreased by 5.52% over a daily basis while downside bets have increased by 5.30% over the same period. The combination of current sentiment and recent changes gives us a further mixedtrading bias.

AUD/USD, S&P 500, Dow Jones Outlook Mixed After Recent Gains

AUD/USD Technical Analysis

AUD/USD may be aiming to extend its bounce off the 0.7015 – 0.7064 inflection zone. However, the pair is trading under the 20-day and 50-day Simple Moving Averages (SMAs). The former may cross under the latter, creating a bearish ‘Death Cross’ that may reinstate the focus to the downside.

AUD/USD – Daily Chart

AUD/USD, S&P 500, Dow Jones Outlook Mixed After Recent Gains

AUD/USD Chart Created in Trading View

S&P 500 Sentiment Outlook – Mixed

The IGCS gauge implies that roughly 40% of retail investors are net long the S&P 500. Upside exposure has decreased by 2.14% over a weekly basis while downside bets have increased by 1.74% over the same period. The combination of current sentiment and recent changes gives a further mixedtrading bias.

AUD/USD, S&P 500, Dow Jones Outlook Mixed After Recent Gains

S&P 500 Technical Analysis

S&P 500 futures have bounced off the 3213 – 3231 inflection zone and pushed above near-term falling resistance from early September. Now, futures are testing the 20-day and 50-day SMAs. A push higher and subsequent break above the 3373 – 3397 inflection range exposes the all-time high at 3587.

S&P 500 Futures – Daily Chart

AUD/USD, S&P 500, Dow Jones Outlook Mixed After Recent Gains

S&P 500 Chart Created in Trading View

Dow Jones Sentiment Outlook – Mixed

The IGCS gauge implies that about 57% of retail traders are net long the Dow Jones. Those with upside exposure have increased by 14.38% over a daily basis while contracting 8.03% compared to last week. The combination of current sentiment and recent changes gives us a further mixed Wall Street trading bias.

Follow me on Twitter @ddubrovskyFX for updates on price trends and retail positioning!

AUD/USD, S&P 500, Dow Jones Outlook Mixed After Recent Gains

Dow Jones Futures Technical Analysis

Dow Jones futures have bounced off the 26193 – 26494 inflection zone and are testing the 20-day and 50-day SMAs. This also follows a break above the near-term falling trend line from earlier this month. Further gains could overturn the bearish implications of the Head and Shoulders chart pattern formed beforehand.

Dow Jones Futures – Daily Chart

AUD/USD, S&P 500, Dow Jones Outlook Mixed After Recent Gains

Dow Jones Chart Created in Trading View

*IG Client Sentiment Charts and Positioning Data Used from September 29th Report

— Written by Daniel Dubrovsky, Currency Analyst for DailyFX.com

To contact Daniel, use the comments section below or @ddubrovskyFX on Twitter