Dollar Index Vulnerable To A Correction 

The latest CFTC report shows that traders are stretched to the long side on the USD. When you can see stretched positioning it means that there is a vulnerability for a sharp correction if there is any reasons for USD selling.  

With US PPI, CPI , and University of Michigan Consumer Sentiment all out this week there is a chance of a USD correction if the data comes in softer than the market is expected. From a seasonal perspective there is a bias for USD selling in the first half of October, so keep this in mind over the next few days.  

Major Trade Risks: 
The major trade risks here is that yields rise on higher US interest rate fears and the USD gains even further if the upcoming US data comes in much better than expected. There is also a risk of a further fallout from the Gaza/Israel conflict with an escalation involving other countries likely to support the USD 

Remember don’t just trade it, Seasonax it!