FXStreet (Delhi) – Research Team at BNP Paribas, notes that the USD selloff extended and broadened on Wednesday, with EURUSD trading through 1.10 and USDJPY falling to 121.08 lows. Key Quotes “While USD losses earlier in the week were confined to lower-yielding funding currencies, on Wednesday the USD also lost ground vs. the AUD, CAD and NZD, despite an RBNZ rate cut, a retreat in crude prices, and a reversal of earlier gains in US equities. The price action suggests that USD long positions are being cut as we head into year-end and a well-anticipated Fed rate hike next week.” “However, our position analysis framework suggests USD long positions were not terribly stretched heading into this week and moves in FX markets continue to look disproportionate or inconsistent with developments in other financial markets. The extent of USD weakness over the past week reduces the danger of a post-Fed squeeze on USD longs and makes it less likely that the Fed Chair will dwell heavily on foreign exchange risks when she speaks at the press conference.” “We remain short AUDUSD from 0.7335 with our stop trailed to entry and have added a long USDJPY position Wednesday as well, anticipating that the USD will recover as we head into the FOMC meeting next week although the pair has sunk uncomfortably close to our 120.80 stop already. Ahead Thursday, the US data calendar remains quiet, with weekly initial jobless claims the only notable release.” For more information, read our latest forex news.