Forex Speculators dropped US Dollar bets to 9-month low

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US Dollar net speculator positions fell to $6.48 billion last 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 reduced their bullish bets for the US dollar last week to the lowest point in over nine months.

Non-commercial large futures traders, including hedge funds and large speculators, had an overall US dollar long position totaling $6.48 billion as of Tuesday June 13th, according to the latest data from the CFTC and dollar amount calculations by Reuters. This was a weekly decrease of $-1.52 billion from the $8.00 billion total long 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).

The aggregate speculator positions have fallen four out of the past five weeks and have now declined to the lowest level since August 30th 2016 when bets equaled $5.29 billion.

The last time the aggregate dollar position fell into negative territory was May 17th 2016 with a $-4.19 billion position.


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Weekly Speculator Contract Changes:

The major currencies that improved against the US dollar last week were the euro (5,044 weekly change in contracts), Japanese yen (4,474 contracts), Swiss franc (2,095 contracts), Canadian dollar (5,906 contracts), New Zealand dollar (3,380 contracts) and the Mexican peso (10,993 contracts).

The currencies whose speculative bets declined last week versus the dollar were the British pound sterling (-2,725 weekly change in contracts) and the Australian dollar (-1,397 contracts).

 

Table of Weekly Commercial Traders and Speculators Levels & Changes:

CurrencyNet CommercialsComms Weekly ChgNet SpeculatorsSpecs Weekly Chg
EuroFx-89,9281,07779,0535,044
GBP43,8925,144-39,441-2,725
JPY60,896-1,406-50,5534,474
CHF14,716-1,097-14,4602,095
CAD98,093-7,745-88,5955,906
AUD6,525-1,694-1,511-1,397
NZD-2,343-4,3241,5953,380
MXN-102,698-11,44795,81410,993

 

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