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Currency Speculators reduced US Dollar bets for 7th week

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US Dollar aggregate speculator positions fell to $-10.23 billion this week

The latest data for the weekly Commitment of Traders (COT) report, released by the Commodity Futures Trading Commission (CFTC) on Friday, showed that large traders and currency speculators continued to push their bets lower for the US dollar this week for a seventh straight week.

Non-commercial large futures traders, including hedge funds and large speculators, had an overall US dollar aggregate position totaling $-10.23 billion as of Tuesday August 8th, according to the latest data from the CFTC and dollar amount calculations by Reuters. This was a weekly decline of $-4.91 billion from the $-5.32 billion total position that was registered the previous week, according to the Reuters calculation (totals of the US dollar contracts against the combined contracts of the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc).

Speculative positions have now been net short for four consecutive weeks with this week’s short position being the most bearish level since January 22nd of 2013 when the aggregate position was at $-13.26 billion.

 

Weekly Speculator Contract Changes:

The individual major currencies saw three weekly changes above the (+ or -) 10,000 contract mark this week in the speculators category.

  • Canadian dollar positions jumped by over +22,000 contracts this week and rose for an eleventh straight week. CAD positions are now in bullish territory for a fourth straight week after crossing over three weeks ago.
  • Japanese yen positions advanced by over +16,000 contracts this week and have gained for three consecutive weeks. The overall JPY position, which remains very bearish, fell below the -100,000 net contract level for the first time in five weeks.
  • The euro position increased by over 11,000 contracts this week after falling for two straight weeks. The overall euro standing is now at the highest level since May 3rd 2011 when the net position totaled +99,516 contracts.

The major currencies that rose against the US dollar last week were the euro (11,048 weekly change in contracts), British pound sterling (4,292 contracts), Japanese yen (16,383 contracts) and the Canadian dollar (22,183 contracts).

The currencies whose speculative bets fell last week versus the dollar were the Swiss franc (-2,842 contracts), Australian dollar (-2,703 contracts), New Zealand dollar (-1,453 contracts) and the Mexican peso (-7,112 contracts).

 

Table of Weekly Commercial Traders and Speculators Levels & Changes:

Currency Net Commercials Comms Weekly Chg Net Speculators Specs Weekly Chg
EuroFx -121,790 -13,229 93,685 11,048
GBP 20,738 -2,369 -25,160 4,292
JPY 110,169 -14,763 -95,813 16,383
CHF 3,448 4,992 -1,402 -2,842
CAD -84,985 -23,501 62,821 22,183
AUD -75,475 4,113 58,010 -2,703
NZD -35,892 1,675 33,485 -1,453
MXN -113,010 7,249 106,437 -7,112

 

This latest COT data is through Tuesday and shows a quick view of how large speculators or non-commercials (for-profit traders) as well as the commercial traders (hedgers & traders for business purposes) were positioned in the futures markets. All currency positions are in direct relation to the US dollar where, for example, a bet for the euro is a bet that the euro will rise versus the dollar while a bet against the euro will be a bet that the dollar will gain versus the euro.

 

Weekly Charts: Large Trader Weekly Positions vs Price

EuroFX:

 

British Pound Sterling:

 

Japanese Yen:

 

Swiss Franc:

 

Canadian Dollar:

 

Australian Dollar:

 

New Zealand Dollar:

 

Mexican Peso:

*COT Report: The weekly commitment of traders report summarizes the total trader positions for open contracts in the futures trading markets. The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators). Find CFTC criteria here: (http://www.cftc.gov/MarketReports/CommitmentsofTraders/ExplanatoryNotes/index.htm).

The Commitment of Traders report is published every Friday by the Commodity Futures Trading Commission (CFTC) and shows futures positions data that was reported as of the previous Tuesday (3 days behind).

Each currency contract is a quote for that currency directly against the U.S. dollar, a net short amount of contracts means that more speculators are betting that currency to fall against the dollar and a net long position expect that currency to rise versus the dollar.

(The charts overlay the forex closing price of each Tuesday when COT trader positions are reported for each corresponding spot currency pair.) See more information and explanation on the weekly COT report from the CFTC website.

Article by CountingPips.com

 

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About Louie Lewis

Louie Lewis
Successful forex trading starts with you first. Then comes the actual strategies and techniques. I have been involved with forex and forex trading for a few years now. It is a wonderful way to build wealth. The learning never stops and I want to help others along their journey into this wonderful market of opportunity.

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