CountingPips » Forex Blog

Currency Speculators pile into US Dollar long bets as Euro, Aussie bets falter

admin — Mon, 21 May 2012 00:43:45 +0000

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators increased their overall US dollar long positions last week for the second consecutive week as speculators added to their euro short positions to the highest level on record.

Non-commercial futures traders, including hedge funds and large speculators, increased their total US dollar long positions to $28.52 billion on May 15th from a total long position of $20.95 billion on May 8th, according to the CFTC COT data and calculations by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.

Individual Currencies:

EuroFX: Currency speculator sentiment plummeted for the euro currency last week as euro net short positions or bets against the currency increased to 173,869 contracts on May 15th from the previous week’s total of 106,990 net short contracts on May 8th. This is the highest level for euro short positions on record surpassing the January 23rd level when short contracts totaled 171,347.

The COT report is published every Friday by the Commodity Futures Trading Commission (CFTC) and shows futures positions as of the previous Tuesday. It can be a useful tool for traders to gauge investor sentiment and to look for potential changes in the direction of a currency or commodity. Each currency contract is a quote for that currency directly against the U.S. dollar, where as a net short amount of contracts means that more speculators are betting that currency to fall against the dollar and net long position expect that currency to rise versus the dollar. The graphs overlay the forex spot closing price of each Tuesday when COT trader positions are reported for each corresponding spot currency pair.

GBP: British pound sterling positions dipped slightly last week after rising for a four consecutive weeks and ascending to their highest level in over a year. British pound positions saw a total of 25,021 net long contracts on May 15th following a total of 25,339 net long contracts registered on May 8th. Before last week’s pullback, Pound positions were at the highest level since May 3rd 2011 when long contracts equaled 30,807.

JPY: Japanese yen speculative contracts improved last week for a fifth consecutive week as Yen positions totaled 34,315 net short contracts reported on May 15th following a total of 41,093 net short contracts on May 8th. The improvement in the Japanese positions has coincided with the US Dollar falling against the yen in the spot price forex market as the pair currently trades under the 80.00 level.

CHF: Swiss franc speculator positions decreased sharply last week and fell for the second straight week. Speculator positions for the Swiss currency futures registered a total of 26,694 net short contracts on May 15th following a total of 16,494 net short contracts as of May 8th.

CAD: Canadian dollar positions declined last week for a second straight week after reaching the highest level of the year on May 1st. Canadian dollar positions fell to a total of 51,005 net long contracts as of May 15th following a total of 60,095 long contracts that were reported for May 8th. CAD positions had recently surpassed their previous highest level of the year and reached their best level since March of 2011 on May 1st at positive 70,223 contracts.

AUD: The Australian dollar long positions dropped sharply for a second consecutive week. Aussie positions declined to a total net amount of 4,734 long contracts on May 15th after falling to 25,104 net long contracts as of May 8th. AUD speculative positions are now at the lowest level since at least 2009 and surpassed the previous low level of the last 12 months that was a total of 5,167 contracts on September 26th of 2011.

NZD: New Zealand dollar futures speculator positions declined for a fourth straight week as NZD contracts decreased to a total of 2,597 net long contracts as of May 15th following a total of 6,224 net long contracts on May 8th. This is the lowest level for New Zealand Kiwi contracts since January 2nd 2012.

MXN: Mexican peso speculative contracts continued lower after edging down the previous week. Peso long positions decreased to a total of 14,445 net long speculative positions as of May 15th following a total of 36,928 long contracts that were reported for May 8th.

COT Currency Data Summary as of May 15, 2012
Large Speculators Net Positions vs. the US Dollar

EUR -173869
GBP +25021
JPY -34315
CHF -26694
CAD +51005
AUD +4734
NZD +2597
MXN +14445

EUR/USD continues the downtrend, looking at 1.2700 next

admin — Tue, 15 May 2012 17:42:25 +0000

The Euro continues to get sold off heavily again in today’s forex trading as Greece talks for a unity government collapsed today. Greece will now have to hold new elections and their is loud speculation of the Greeks leaving the euro currency.

The EUR/USD fell to the lowest level since the middle of January and looks to test 1.2700 soon. The low for the year was registered on January 13th at 1.2623.

Currency Speculators add to US Dollar long positions. Australian dollar longs fall sharply

admin — Sun, 13 May 2012 21:15:58 +0000

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators raised their overall US dollar long positions last week for the first time in four weeks as speculators increased their euro short positions to the highest level since February and Australian dollar long positions fell sharply.

Non-commercial futures traders, including hedge funds and large speculators, increased their total US dollar long positions to $20.95 billion on May 8th from a total long position of $13.31 billion on May 1st, according to the CFTC COT data and calculations by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.

Individual Currencies:

EuroFX: Currency speculator sentiment declined for the first time in three weeks in the euro currency as euro net short positions or bets against the currency increased to 106,990 contracts on May 8th from the previous week’s total of 106,990 net short contracts on May 1st. This is the highest level for euro short positions since February 13th when short contracts totaled 148,641.

GBP: British pound sterling positions rose last week for a fourth consecutive week and ascended to their highest level in over a year. British pound positions saw a total of 25,339 net long contracts on May 8th following a total of 16,493 net long contracts registered on May 1st. Pound positions have continued to rise higher and are now at the highest level since May 3rd 2011 when long contracts equaled 30,807.

JPY: Japanese yen speculative contracts improved last week for a fourth consecutive week as Yen positions totaled 41,093 net short contracts reported on May 8th following a total of 50,173 net short contracts on May 1st. The improvement in the Japanese positions has coincided with the USDJPY spot price declines as the pair currently trade under the 80.00 level.

CHF: Swiss franc speculator positions decreased last week after improving the previous week. Speculator positions for the Swiss currency futures registered a total of 16,494 net short contracts on May 8th following a total of 14,311 net short contracts as of May 1st.

CAD: Canadian dollar positions declined last week after reaching the highest level of the year the previous week. Canadian dollar positions fell to a total of 60,095 net long contracts as of May 8th following a total of 70,223 long contracts that were reported for May 1st. CAD positions had recently surpassed their previous highest level of the year and reached their best level since March of 2011 on May 1st.

AUD: The Australian dollar long positions dropped sharply after increasing the previous week. Aussie positions fell to a total net amount of 25,104 long contracts on May 8th after rising to 52,280 net long contracts reported as of May 1st. AUD speculative positions are now at their lowest level since November 2011 when long contracts equaled 12,542.

NZD: New Zealand dollar futures speculator positions declined for a third week as NZD contracts decreased to a total of 6,224 net long contracts as of May 8th following a total of 8,025 net long contracts on May 1st.

MXN: Mexican peso speculative contracts trended slightly lower after edging higher the previous week. Peso long positions decreased to a total of 36,928 net long speculative positions as of May 8th following a total of 42,045 long contracts that were reported for May 1st.

COT Currency Data Summary as of May 8, 2012
Large Speculators Net Positions vs. the US Dollar

EUR -143984
GBP +25339
JPY -41093
CHF -16494
CAD +60095
AUD +25104
NZD +6224
MXN +36928

Currency Speculators cut US Dollar longs for 3rd week. Canadian Dollar positions surge higher

admin — Mon, 07 May 2012 13:14:47 +0000

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators decreased their overall US dollar long positions last week for a third consecutive week while Canadian dollar positions showed the largest upward movement and reached their highest position in over a year.

Non-commercial futures traders, usually hedge funds and large speculators, decreased their short positions in the euro, Swiss franc and Japanese yen while adding to long positions in the British pound sterling, Canadian dollar, Australian dollar and the Mexican peso. New Zealand dollar long positions dipped for a second straight week.

Individual Currencies:

EuroFX: Currency speculator sentiment improved for a second straight week in the euro currency as euro net short positions or bets against the currency decreased to 106,990 contracts on May 1st from the previous week’s total of 113,367 net short contracts.

GBP: British pound sterling positions rose last week for a third consecutive week and landed at their highest level in just about a year. British pound positions saw a total of 16,493 net long contracts on May 1st following a total of 7,536 net long contracts registered on April 24th. Pound positions have continued to rise higher and are now at the highest level since May 10th 2011 when long contracts equaled 18,118.

JPY: Japanese yen speculative contracts improved last week for a third consecutive week as Yen positions totaled 50,173 net short contracts reported on May 1st following a total of 55,903 net short contracts on April 24th.

CHF: Swiss franc speculator positions rose last week for a second straight week after declining for the previous two weeks. Speculator positions for the Swiss currency futures registered a total of 14,311 net short contracts on May 1st following a total of 16,641 net short contracts as of April 24th.

CAD: Canadian dollar positions once again advanced higher and reached their highest level since March of 2011. Canadian dollar positions rose to a total of 70,223 net long contracts as of May 1st following a total of 44,224 long contracts that were reported for April 24th. CAD positions recently surpassed their previous highest level of the year and are at the highest level since March 8th 2011 when long contracts numbered 77,544.

AUD: The Australian dollar long positions improved slightly after decreasing the previous week. Aussie positions rose to a total net amount of 52,280 long contracts on May 1st after falling to 46,041 net long contracts reported as of April 24th. AUD speculative positions on April 10th had reached their lowest level since long positions totaled 32,637 on December 27th 2011.

NZD: New Zealand dollar futures speculator positions declined for second straight week as NZD contracts fell to a total of 8,025 net long contracts as of May 1st following a total of 9,486 net long contracts on April 24th. NZD contracts on April 17th were at their highest level since March 13 before pulling back last week.

MXN: Mexican peso speculative contracts trended slightly higher after falling for three straight weeks. Peso long positions increased to a total of 42,045 net long speculative positions as of May 1st following a total of 40,208 long contracts that were reported for April 24th.

COT Currency Data Summary as of May 1, 2012
Large Speculators Net Positions vs. the US Dollar

EUR -106990
GBP +16493
JPY -50173
CHF -14311
CAD +70223
AUD +52280
NZD +8025
MXN +42045

Currency Speculators cut US Dollar longs, turn bullish on British Pound positions for first time since August

admin — Sun, 29 Apr 2012 21:23:47 +0000

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators decreased their overall US dollar long positions last week for a second consecutive week while British pound sterling positions turned positive for the first time since August.

Non-commercial futures traders, including hedge funds and large speculators, decreased their total US dollar long positions to $19.58 billion on April 24th from a total long position of $22.6 billion on April 17th, according to the CFTC COT data and calculations by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.

Individual Currencies:

EuroFX: Currency speculator sentiment improved for the euro currency last week as euro net short positions or bets against the currency decreased to 113,367 contracts on April 24th from the previous week’s total of 118,125 net short contracts. Euro positions had declined two consecutive weeks before last week’s turnaround.

GBP: British pound sterling positions rose last week for a second consecutive week and landed in positive territory for the first time since last August. British pound positions saw a total of 7,536 net long contracts on April 24th following a total of 13,051 net short contracts registered on April 17th. Pound positions have surged higher and surpassed the August 29th level of 444 net long contracts to level at the highest standing since August 22 when long contracts equaled 10,961.

JPY: Japanese yen speculative contracts improved slightly last week for a second consecutive week as Yen positions totaled 55,903 net short contracts reported on April 24th following a total of 57,803 net short contracts on April 17th.

CHF: Swiss franc speculator positions declined last week for a second straight week after improving for the previous two weeks. Speculator positions for the Swiss currency futures registered a total of 16,641 net short contracts on April 24th following a total of 13,762 net short contracts as of April 17th.

CAD: Canadian dollar positions continued to advance higher and reached their highest level since May of 2011. Canadian dollar positions rose to a total of 44,224 net long contracts as of April 24th following a total of 38,028 long contracts that were reported for April 17th. CAD positions surpassed their highest level of the year which was a total of 42,315 contracts on March 19th and are at the highest level since May 3, 2011 when long contracts numbered 54,041.

AUD: The Australian dollar long positions declined slightly after advancing the previous week. Aussie positions fell to a total net amount of 46,041 long contracts on April 24th after rising to 48,421 net long contracts reported as of April 17th. AUD speculative positions on April 10th had reached their lowest level since long positions totaled 32,637 on December 27th 2011.

NZD: New Zealand dollar futures speculator positions declined following rises for three consecutive weeks. NZD contracts decreased to a total of 9,486 net long contracts as of April 24th following a total of 11,939 net long contracts on April 17th. NZD contracts on April 17th were at their highest level since March 13 before pulling back last week.

MXN: Mexican peso speculative contracts trended lower for the third consecutive week. Peso long positions declined to a total of 40,208 net long speculative positions as of April 24th following a total of 46,101 long contracts that were reported for April 17th.

COT Currency Data Summary as of April 24, 2012
Large Speculators Net Positions vs. the US Dollar

EUR -113367
GBP +7536
JPY -55903
CHF -16641
CAD +44224
AUD +46041
NZD +9486
MXN +40208

Forex: Currency Speculators trim US Dollar positions while Euro shorts rise. Japanese Yen, Aussie positions gain

admin — Sun, 22 Apr 2012 15:35:56 +0000

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators decreased their overall US dollar long positions last week while euro positions declined for a second straight week to the lowest level in two months.

Non-commercial futures traders, including hedge funds and large speculators, decreased their total US dollar long positions to $22.6 billion on April 17th from a total long position of $23.2 billion on April 10th, according to the CFTC COT data and calculations by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.

Individual Currencies:

EuroFX: Currency speculators decreased their sentiment for the euro currency for second consecutive week as euro net short positions or bets against the currency increased to 118,125 contracts on April 17th from the previous week’s total of 101,364 net short contracts. Euro positions are now at the lowest level since February 21st when short contracts totaled 142,159. .

GBP: British pound sterling positions rose last week and continued to show a steady improvement over the last five weeks. British pound positions saw a total of 13,051 net short contracts on April 17th following a total of 18,784 net short contracts registered on April 10th.

JPY: Japanese yen speculative contracts improved last week as Yen positions rose to a total of 57,803 net short contracts reported on April 17th following a total of 66,084 net short contracts on April 10th. Japanese yen positions have been at the lowest level in years for the past four weeks.

CHF: Swiss franc speculator positions declined last week after improving for the previous two weeks. Speculator positions for the Swiss currency futures registered a total of 13,762 net short contracts on April 17th following a total of 9,919 net short contracts as of April 10th.

CAD: Canadian dollar positions jumped higher after declining the previous week. Canadian dollar positions rose to a total of 38,028 net long contracts as of April 17th following a total of 27,967 long contracts that were reported for April 10th. CAD positions are now at their highest position in just about a month as positions are just below the March 20th level of 42,315 contracts.

AUD: The Australian dollar long positions advanced after declining for two consecutive weeks. Australian dollar positions increased to a total net amount of 48,421 long contracts on April 17th after declining to 39,429 net long contracts reported as of April 10th. The AUD speculative positions on April 10th were at their lowest level since long positions totaled 32,637 on December 27th 2011.

NZD: New Zealand dollar futures speculator positions jumped higher for a third consecutive week. NZD contracts increased to a total of 11,939 net long contracts as of April 17th following a total of 7,170 net long contracts on April 10th. NZD contracts are now at their highest level since March 13 after falling on March 27th to the lowest level for New Zealand dollar contracts since January 3rd when contracts equaled 2,436 net long positions.

MXN: Mexican peso speculative contracts fell lower for a second consecutive week. Peso long positions decreased to a total of 46,101 net long speculative positions as of April 17th following a total of 68,600 long contracts that were reported for April 10th.

COT Currency Data Summary as of April 17, 2012
Large Speculators Net Positions vs. the US Dollar

EUR -118125
GBP -13051
JPY -57803
CHF -13762
CAD +38028
AUD +48421
NZD +11939
MXN +46101

Forex: Currency Speculators raise US Dollar long positions. Euro, Pound, Aussie positions drop

admin — Sun, 15 Apr 2012 18:12:36 +0000

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators added to their overall US dollar long positions last week to the highest level since last June while euro positions deteriorated to a net amount of over 100,000 short contracts.

Non-commercial futures traders, including hedge funds and large speculators, raised their total US dollar long positions to $23.199 billion on April 10th from a total long position of $17.8 billion on April 3rd, according to the CFTC COT data and calculations by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.

Individual Currencies:

EuroFX: Currency speculators decreased their sentiment for the euro currency as euro net short positions or bets against the currency rose to 101,364 contracts on April 10th from the previous week’s total of 79,480 net short contracts. Euro contracts on April 3rd were at their best position since November 15th when short positions totaled 76,147 contracts before the turnaround last week.

GBP: British pound sterling positions decreased last week following three consecutive weeks of improvements that had brought pound positions to their best placement since August. British pound positions saw a total of 18,784 net short contracts on April 10th following a total of 8,807 net short contracts registered on April 3rd.

JPY: Japanese yen speculative contracts edged lower as positions were close to their lowest level since 2007 (marked on March 27th) and reversed the previous week’s slight gain. Yen positions fell to a total of 66,084 net short contracts reported on April 10th following a total of 65,108 net short contracts on April 3rd.

CHF: Swiss franc speculator positions improved for a second consecutive week as of April 10th. Speculator positions for the Swiss currency futures registered a total of 9,919 net short contracts on April 10th following a total of 14,676 net short contracts as of April 3rd.

CAD: Canadian dollar positions edged lower after advancing the previous week. Canadian dollar positions declined to a total of 27,967 net long contracts as of April 10th following a total of 29,487 long contracts that were reported for April 3rd. CAD positions on March 20th had reached their highest position since May 3rd 2011 when long contracts equaled 54,041 before declining retreating.

AUD: The Australian dollar long positions declined for the second consecutive week last week. Australian dollar positions fell to a total net amount of 39,429 long contracts on April 10th after declining to 49,319 net long contracts reported as of April 3rd. The AUD speculative positions are now at their lowest level since long positions totaled 32,637 on December 27th 2011.

NZD: New Zealand dollar futures speculator positions rose higher for a second consecutive week. NZD contracts increased to a total of 7,170 net long contracts as of April 10th following a total of 5,846 net long contracts on April 3rd. NZD contracts on March 27th were the lowest level for New Zealand dollar contracts since January 3rd when contracts equaled 2,436 net long positions.

MXN: Mexican peso speculative contracts declined lower following increases the previous two weeks. Peso long positions decreased to a total of 68,600 net long speculative positions as of April 10th following a total of 84,503 long contracts that were reported for April 3rd.

COT Currency Data Summary as of April 10, 2012
Large Speculators Net Positions vs. the US Dollar

EUR -101364
GBP -18784
JPY -66084
CHF -9919
CAD +27967
AUD +39429
NZD +7170
MXN +68600

Other COT Trading Resources:

Trading Forex Using the COT Report

Forex: Currency Futures Speculators cut USD long positions. Canadian Loonie longs rise to highest level since May 2011

admin — Sun, 25 Mar 2012 19:36:26 +0000

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators cut back on their overall US dollar long positions last week while Japanese yen positions rebounded after falling for six consecutive weeks and Canadian dollar long positions rose to their highest level since May 2011.

Non-commercial futures traders, including hedge funds and large speculators, decreased their total US dollar long positions to $11.67 billion on March 20th from a total long position of $19.0 billion on March 13th, according to the CFTC COT data and calculations by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.

Individual Currencies:

EuroFX: Currency speculators increased their sentiment for the euro currency for a second consecutive week as Euro short positions fell to the lowest level since November 2011. Euro net positions declined to 82,954 short contracts on March 20th from the previous week’s total of 99,336 net short contracts. Euro contracts are at the best position since November 22nd when short positions totaled 85,068 contracts.

GBP: British pound sterling positions saw a surge of improvement last week after consecutive weekly declines in the previous weeks. British pound positions saw a total of 15,852 net short positions on March 20th following a total of 41,848 net short positions registered on March 13th. British pound sterling positions are still on the short side but are at their best level since September 6th when positions equaled 13,220 short contracts.

JPY: The Japanese yen speculative contracts rebounded last week from their sharp downtrend that had lasted sixth consecutive weeks. Yen positions improved to a total of 25,821 net short contracts reported on March 20th following a total of 42,380 net short contracts on March 13th. Yen speculative positions, two weeks ago, were at their lowest level since April 19th 2011 when positions totaled 52,983 short contracts.

CHF: Swiss franc speculator positions rose for a second consecutive week last week. Speculator positions for the Swiss currency futures registered a total of 11,191 net short contracts on March 20th following a total of 14,798 net short contracts as of March 13th.

CAD: Canadian dollar positions surged higher for a seventh consecutive week and rose to their highest level since May 2011. Canadian dollar positions advanced to a total of 42,315 net long contracts as of March 20th following a total of 26,721 long contracts that were reported for March 13th. CAD positions are at their highest position since May 3rd 2011 when long contracts equaled 54,041.

AUD: The Australian dollar long positions fell sharply after rebounding the previous week. Australian dollar positions decreased to a total net amount of 45,191 long contracts on March 20th after totaling 66,756 net long contracts reported as of March 13th. The AUD speculative positions are now at their lowest level since long positions totaled 32,637 on December 27th 2011.

NZD: New Zealand dollar futures speculator positions decreased for a fourth consecutive week after they had risen for nine straight weeks through February 21st. NZD contracts dropped to a total of 4,210 net long contracts as of March 20th following a total of 13,223 net long contracts on March 13th. This is the lowest level for New Zealand dollar contracts since January 3rd when contracts equaled 2,436 net long positions.

MXN: Mexican peso speculative contracts decreased sharply following a string of ten consecutive weekly increases through March 13th. Peso long positions declined to a total of 24,329 net long speculative positions as of March 20th following a total of 78,892 long contracts that were reported for March 13th.

COT Currency Data Summary as of March 20, 2012
Large Speculators Net Positions vs. the US Dollar

EUR -82954
GBP -15852
JPY -25821
CHF -11191
CAD +42315
AUD +45191
NZD +4210
MXN +24329

Other COT Trading Resources:

Trading Forex Using the COT Report

David Song of DailyFx shares his views on Currency themes, the EUR/USD & USD/JPY in Forex Interview

admin — Wed, 21 Mar 2012 15:17:15 +0000

By CountingPips.com

Today, I am pleased to share a forex interview and commentary on the latest major forex events and trends with currency strategist David Song from DailyFx.com. David is an active trader and studied macroeconomic policies under a visiting scholar at the Federal Reserve Bank of St. Louis while attending the Zicklin School of Business at Baruch College. He focuses on economic developments and central bank rhetoric to forecast long term currency price action and has been quoted by many major news sites including Reuters, Dow Jones Marketwatch, and CNN Money.

Q: What would you say is the major global theme in currency markets at this time? What do you feel is driving major currency trader sentiment?

With the headline-driven market, the major fundamental theme driving currency prices is the global threat of the sovereign debt crisis. World policy makers continue to strike a cautious tone amid the ongoing turmoil in the euro-area, and the risk for contagion will continue drag on investor confidence as European officials struggle to meet on common ground. As the governments operating under the single currency become increasingly reliant on monetary support, we are likely to see the European Central Bank carry out its easing cycle throughout 2012, and the Governing Council may have little choice but to push the benchmark interest rate below 1.00% as the region continues to face a risk for a prolonged recession.

Q: The Federal Reserve looks increasingly unlikely to inject QE3 into the economy any time soon. Do you agree with this, and if so, could this be considered bullish for the USD?

In light of the more robust recovery in the U.S., the Fed certainly has limited scope to expand its balance sheet further. As we expect the FOMC to bring its easing cycle to an end in 2012, the shift in the policy outlook instills a bullish forecast for the U.S dollar, and we should see the committee continue to soften its dovish tone as stronger growth paired with sticky prices raises the risk for inflation. Indeed, market participants see the Fed starting to normalize monetary policy over the next 12-months amid the shift in the policy outlook, and the rise in interest rate expectations should strengthen the dollar further as the central bank prepares to wind down its balance sheet while dismissing the zero-interest rate policy (ZIRP).

Q: As more bailouts are most likely necessary for further euro zone countries, do you feel that the EUR/USD inevitably will trend lower? What is your outlook or forecast for the EUR/USD?

We maintain a bearish outlook for the EURUSD as the fundamental outlook for the euro-area remains bleak, and the pair looks poised for a major move to the downside as it appears to be carving a head-and-shoulders top in March. In turn, we expect to see fresh yearly lows in the EURUSD, and the pair may ultimately give back the rebound from back in 2010 as European policy makers struggle to restore investor confidence. As the EU maintains a reactionary approach in addressing the debt crisis, the efforts could arguably be too little too late, and the implementation of the crisis-fighting measures are likely to come under scrutiny as the group now looks to promote growth.

Q: The USDJPY has surged to its highest level in almost a year, can you comment on this currency pair and do you feel that the forecasts to go higher are correct?

The recent surge in the USDJPY comes as the Federal Reserve talks down speculation for QE3, and the rise in interest rate expectations should carry the dollar-yen higher as the Bank of Japan continues to embark on its easing cycle. As the BoJ pledges to meet the 1% target for inflation, it looks as though the central bank will further expand its asset purchases over the coming months, and the disparity in monetary policy will heavily influence the exchange rate as these developing fundamental themes take shape.

Q: There was a lot of talk last week about US treasuries prices making moves, can you explain how this can affect the US dollar and the currency markets?

As market participants speculate the Federal Reserve to normalize monetary policy ahead of the 2014 pledge, expectations for higher interest rates have sparked demands for U.S treasuries, but this development will have the greatest impact on the USDJPY as the BoJ looks to maintain its zero interest rate policy for a prolonged period of time. Indeed, the shift in central bank rhetoric will heavily influence the USD, and we should see the correlation between risk sentiment and the dollar continue to decouple as interest rates are set to go higher.

Thank you David for taking the time for participating and sharing your views in this latest forex interview. To read David’s latest currency analysis and trading strategies you can visit DailyFx.com.

Forex: Currency Futures Speculators trim USD positions. Sharply raise shorts of Japanese Yen

admin — Mon, 19 Mar 2012 17:00:55 +0000

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators decreased their overall US dollar long positions last week while Japanese yen positions fell sharply for a sixth consecutive week and declined to their lowest level in almost a year.

Non-commercial futures traders, including hedge funds and large speculators, trimmed their total US dollar long positions to $19.0 billion on March 13th from a total long position of $19.27 billion on March 6th, according to the CFTC COT data and calculations by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.

Individual Currencies:

EuroFX: Currency speculators increased their sentiment for the euro currency as Euro short positions fell to the lowest since December. Euro net short positions declined to 99,336 contracts against the currency on March 13th from the previous week’s total of 116,473 net short contracts. Contracts are at the best position since December 6th when short positions totaled 95,814 contracts.

GBP: British pound sterling positions fell for a second consecutive week, according to the data as of March 13th. British pound positions saw a total of 41,848 net short positions on March 13th following a total of 37,099 net short positions registered on March 6th. British pound sterling positions are at their lowest level since December 6th when positions equaled 43,560 short contracts.

JPY: The Japanese yen speculative contracts continued their sharp downtrend last week to drop for a sixth consecutive week and declined to their lowest level since April 2011. Yen positions fell to a total of 42,380 net short contracts reported on March 13th following a total of 19,358 net short contracts on March 6th. Yen speculative positions are at their lowest level since April 19th 2011 when positions totaled 52,983 short contracts.

CHF: Swiss franc speculator positions rose after contracts were virtually unchanged for the previous three consecutive weeks. Speculator positions for the Swiss currency futures registered a total of 14,798 net short contracts on March 13th following a total of 19,478 net short contracts as of March 6th.

CAD: Canadian dollar positions rose higher for a sixth consecutive week and remain at their highest level since August. Canadian dollar positions rose to a total of 26,721 net long contracts as of March 13th following a total of 26,032 long contracts that were reported for March 6th. CAD positions are at their highest position since August 2nd 2011 when long contracts equaled 41,037.

AUD: The Australian dollar long positions rebounded last week after a decline the previous week. Australian dollar positions increased to a total net amount of 66,756 long contracts on March 13th after totaling 61,720 net long contracts reported as of March 6th. The AUD speculative positions on February 28th were at their highest level since Australian dollar long positions totaled 81,438 on July 26th 2011.

NZD: New Zealand dollar futures speculator positions decreased for a third consecutive week after they had risen for nine straight weeks through February 21st. NZD contracts decreased to a total of 13,223 net long contracts as of March 13th following a total of 16,788 net long contracts on March 6th. NZD contracts on February 21st had passed the previous 12-month high level recorded on August 2nd when net long contracts totaled 24,126.

MXN: Mexican peso speculative contracts improved for a tenth consecutive week and continue to be at the best position since August 2nd. Peso long positions numbered a total of 78,892 net long speculative positions as of March 13th following a total of 66,347 long contracts that were reported for March 6th.

COT Currency Data Summary as of March 13, 2012
Large Speculators Net Positions vs. the US Dollar

EUR -99336
GBP -41848
JPY -42380
CHF -14798
CAD +26721
AUD +66756
NZD +13223
MXN +78892

Other COT Trading Resources:

Trading Forex Using the COT Report

EUR/CHF awakens from its sleep

admin — Wed, 14 Mar 2012 14:53:57 +0000

By CountingPips

The EUR/CHF came alive this morning and trades at its highest level in over month. This pair has been more or less dormant for the last month as the Swiss National Bank (SNB) has vowed to keep the pair above 1.20 to stem too much strength in the franc (hurting Swiss exports). The EUR/CHF continued to stall just above the 1.20 level lately as traders have anticipated intervention by the Swiss Bank.

Although today’s bullish action is very unlikely due to SNB buying, it will be interesting to see if the move will be sustained and present higher levels into play or will be beaten back down and perhaps testing the SNB’s resolve in keeping the pair above 1.20.

EUR/CHF – Breaking out of its recent range on the 4-hour chart

Forex: Currency Futures Speculators boost US Dollar holdings. Trim Euro, Pound and Yen contracts

admin — Mon, 12 Mar 2012 14:48:57 +0000

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators increased their overall US dollar long positions last week while Japanese yen positions fell sharply for a fifth consecutive week and declined to their lowest level since April 2011.

Non-commercial futures traders, usually hedge funds and large speculators, added to their short positions in the euro, British pound sterling, Japanese yen and the Swiss franc while also trimming their long positions in the Australian dollar and the New Zealand dollar. The Canadian dollar and the Mexican peso saw higher long positions directly against the US dollar with both currencies showing multiple weekly gains.

Individual Currencies:

EuroFX: Currency speculators increased their Euro short positions after sentiment for the euro currency had improved for two consecutive weeks. Euro net short positions rose to 116,473 contracts against the currency on March 6th from the previous week’s total of 109,674 net short contracts.

GBP: British pound sterling positions fell back as short positions increased after two weeks of improvements and seeing their best position since September, according to the data as of March 6th. British pound positions saw a total of 37,099 net short positions on March 6th following a total of 23,235 net short positions registered on February 28th. British pound sterling positions were at their best level on February 28th since September 6th when positions equaled 13,220 short contracts.

JPY: The Japanese yen speculative contracts continued their downward trend last week to fall for a fifth consecutive week and declined to their lowest level since April 2011. Yen positions dropped to a total of 19,358 net short contracts reported on March 6th following a total of 1,203 net short contracts on February 28th. Yen speculative positions, now in short territory for second straight week, are at their lowest level since April 26th when positions totaled 36,997 short contracts.

CHF: Swiss franc speculator positions were virtually unchanged for the third consecutive week last week. Speculator positions for the Swiss currency futures registered a total of 19,478 net short contracts on March 6th following a total of 19,391 net short contracts as of February 28th.

CAD: Canadian dollar positions rose higher for a fifth consecutive week and are at their highest level since August. Canadian dollar positions rose to a total of 26,032 net long contracts as of March 6th following a total of 22,480 long contracts that were reported for February 28th. CAD positions are now at their highest position since August 2nd 2011 when long contracts equaled 41,037.

AUD: The Australian dollar long positions declined following two consecutive weekly increases. Australian dollar positions fell to a total net amount of 61,720 long contracts on March 6th after totaling 78,201 net long contracts reported as of February 28th. The AUD speculative positions on February 28th were at their highest level since Australian dollar long positions totaled 81,438 on July 26th 2011.

NZD: New Zealand dollar futures speculator positions decreased for a second consecutive week after they had risen for nine straight weeks through February 21st. NZD contracts fell to a total of 16,788 net long contracts as of March 6th following a total of 22,114 net long contracts on February 28th. NZD contracts on February 21st had passed the previous 12-month high level recorded on August 2nd when net long contracts totaled 24,126.

MXN: Mexican peso speculative contracts improved for a ninth consecutive week and are at the best position since August 2nd. Peso long positions numbered a total of 66,347 net long speculative positions as of March 6th following a total of 60,750 long contracts that were reported for February 28th.

COT Currency Data Summary as of March 6, 2012
Large Speculators Net Positions vs. the US Dollar

EUR -116473
GBP -37099
JPY -19358
CHF -19478
CAD +26032
AUD +61720
NZD +16788
MXN +66347

Other COT Trading Resources:

Trading Forex Using the COT Report

Forex: Currency Futures Speculators cut Japanese Yen position sharply last week

admin — Sun, 04 Mar 2012 18:40:48 +0000

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators decreased their overall US dollar long positions last week while Japanese yen positions fell sharply for a fourth consecutive week and declined to their lowest level since May 2011.

Non-commercial futures traders, including hedge funds and large speculators, increased their total US dollar long positions to $12.98 billion on February 28th from a total long position of $17.25 billion on February 21st, according to the CFTC COT data and calculations by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.

Individual Currencies:

EuroFX: Currency speculators sharply decreased their Euro short positions as sentiment for the euro currency improved for a second consecutive week last week. Euro net short positions decreased to 109,674 contracts against the currency on February 28th from the previous week’s total of 142,159 net short contracts.

GBP: British pound sterling positions improved for a second consecutive week to see their best position since September, according to the data as of February 28th. British pound positions saw a total of 23,235 net short positions on February 28th following a total of 31,350 net short positions registered on February 21st. British pound sterling positions are now their best level since September 6th when positions equaled 13,220 short contracts.

JPY: The Japanese yen speculative contracts continued to decline last week to fall for a fourth consecutive week and dropped over to a total short positions for the first time since May 2011, according to the data on February 28th. Yen positions dropped to a total of 1,203 net short contracts reported on February 28th following a total of 17,257 net long contracts on February 21st. Yen speculative positions, now in short territory, are at their lowest level since May 31st when positions totaled 1,648 short contracts.

CHF: Swiss franc speculator positions improved just slightly from the previous week. Speculator positions for the Swiss currency futures registered a total of 19,391 net short contracts on February 28th following a total of 19,846 net short contracts as of February 21st.

CAD: Canadian dollar positions rose higher for a fourth consecutive week and continue to be at their highest level since August. Canadian dollar positions rose to a total of 22,480 net long contracts as of February 28th following a total of 14,112 long contracts that were reported for February 21st. CAD positions are now at their highest position since August 7th 2011 when long contracts equaled 23,704.

AUD: The Australian dollar long positions rose slightly for the second consecutive week. Australian dollar positions increased to a total net amount of 78,201 long contracts on February 28th after totaling 74,700 net long contracts reported as of February 21st. The AUD speculative positions are now at their highest level since Australian dollar long positions totaled 81,438 on July 26th 2011.

NZD: New Zealand dollar futures speculator positions decreased after they had risen for nine consecutive weeks through February 21st. NZD contracts fell to a total of 22,114 net long contracts as of February 28th following a total of 24,211 net long contracts on February 21st. NZD contracts on February 21st had passed the previous 12-month high level recorded on August 2nd when net long contracts totaled 24,126.

MXN: Mexican peso speculative contracts improved for an eighth straight week and continued to be at the best position since August 2nd. Peso long positions numbered a total of 60,750 net long speculative positions as of February 28th following a total of 49,425 long contracts that were reported for February 21st.

COT Currency Data Summary as of February 28, 2012
Large Speculators Net Positions vs. the US Dollar

EUR -109674
GBP -23235
JPY -1203
CHF -19391
CAD +22480
AUD +78201
NZD +22114
MXN +60750

Other COT Trading Resources:

Trading Forex Using the COT Report

Currency Futures Speculators added to USD long positions last week. Yen bets drop for 3rd week

admin — Sun, 26 Feb 2012 22:55:51 +0000

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators added to their overall US dollar long positions last week for a second consecutive week while Euro short positions dipped slightly.

Non-commercial futures traders, including hedge funds and large speculators, increased their total US dollar long positions to $17.25 billion on February 21st from a total long position of $16.98 billion on February 14th, according to the CFTC COT data and calculations by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.

Individual Currencies:

EuroFX: Currency speculators slightly decreased their Euro short positions after adding to their short positions the previous week. Euro net short positions fell to 142,159 contracts against the currency on February 21st from the previous week’s total of 148,641 net short contracts.

GBP: British pound sterling positions improved after seeing bearish positions increase for two consecutive weeks, according to the data as of February 21st. British pound positions saw a total of 31,350 net short positions on February 21st following a total of 40,599 net short positions registered on February 14th.

JPY: The Japanese yen net long speculative contracts fell again last week to decline for a third consecutive week, according to the data on February 21st. Yen long positions dropped to a total of 17,257 net contracts reported on February 21st following a total of 29,459 net long contracts on February 14th. Yen speculative positions have now fallen to their lowest level since July 5th when positions totaled 14,327 contracts.

CHF: Swiss franc speculators continued to bet against Swiss currency and increased their short bets against the Swiss currency to the highest level in years. Speculator positions for the Swiss currency futures numbered a total of 19,846 net short contracts on February 21st following a total of 15,863 net short contracts as of February 14th.

CAD: Canadian dollar positions rose higher for third consecutive week and are at the highest level since August. Canadian dollar positions rose to a total of 14,112 net long contracts as of February 21st following a total of 9,566 short contracts that were reported for February 14th. CAD positions are now at their highest position since early August when long contracts equaled 23,704.

AUD: The Australian dollar long positions rose slightly after declines for two consecutive weeks. Australian dollar positions decreased to a total net amount of 74,700 long contracts on February 21st after totaling 73,741 net long contracts reported as of February 14th. The AUD speculative positions were at their highest level in six months when Australian dollar long positions totaled 81,438 on January 31st and positions have continued to hover around this level.

NZD: New Zealand dollar futures speculator positions advanced higher and rose for a ninth consecutive week through February 21st. NZD contracts increased to a total of 24,211 net long contracts as of February 21st following a total of 23,870 net long contracts on February 14th. NZD positions have now risen for nine straight weeks after touching a nine-month low on December 20th. NZD contracts have now passed the previous 12-month high level recorded on August 2nd when net long contracts totaled 24,126.

MXN: Mexican peso speculative contracts improved for a seventh straight week and are now at the best position since August 2nd. Peso long positions numbered a total of 49,425 net long speculative positions as of February 21st following a total of 41,239 long contracts that were reported for February 14th.

COT Currency Data Summary as of February 21, 2012
Large Speculators Net Positions vs. the US Dollar

EUR -142159
GBP -31350
JPY +17257
CHF -19846
CAD +14112
AUD +74700
NZD +24211
MXN +49425

Other COT Trading Resources:

Trading Forex Using the COT Report

Currency Analyst David Song comments on the Euro, USD, Yen and Oil in our Forex Interview

admin — Thu, 23 Feb 2012 13:45:25 +0000

By Zac Storella, CountingPips.com

Q: Hot off the press this week we have the Eurozone and Greece reaching an agreement on a second bail-out. Going forward this is obviously better news for the Eurozone as a union but what impact do you feel it will have on the currency?

The agreement has helped to dampen the risk for contagion, but the implementation of the unprecedented measures will certainly influence the currency market as the sovereign debt crisis clouds the fundamental outlook for the euro-area. As the region slips back into recession, the tough austerity measures certainly raises the risk of seeing a major economic downturn in 2012 and the European Central Bank may take further steps to shore up the ailing economy as growth and inflation falter. At the same time, renewed threats of a Greek default instills a bearish outlook for the single currency as Fitch pledges to lower Greece’s credit rating to ‘Restricted Default’ and the ongoing turmoil in the euro-area may continue to sap risk-taking behavior as European policy makers struggle to restore investor confidence.

Q: Outside of the Greek bail-out, what other indicators or themes are you watching for in terms of having an overall forex market impact and dictating trend direction?

Beyond the sovereign debt crisis, I am keeping a close eye on China as policy makers scramble to avert a ‘hard landing.’ Indeed, the People’s Bank of China took further steps to shore up the economy by lowering the reserve requirement ratio (RRR) for commercial banks and it seems as though the central bank will carry out more easing in 2012 in order to shore up the banking sector. It seems as though the Chinese government is turning a blind eye to the stickiness in price growth amid the slowing recovery, but the efforts may fail to produce a ‘soft landing’ for the economy as the region faces a liquidity squeeze.

Q: The US economy added more jobs than predicted this month and jobless claims recently have trended lower and just fell to a four-year low last week. A general rosier outlook is emerging for the US economy and the job market. In your trading analysis, are you buying into this picture of a healthier US economy and how is this effecting your trading decisions? If not, what do you think is going to put a dampener on this rosier outlook?

As the more robust recovery in the U.S. economy limits the Fed’s scope to push through another large-scale asset purchase program, I expect to see the central bank soften its dovish tone for monetary policy in 2012. With the stickiness in underlying price growth, Fed officials may see scope to conclude the easing cycle this year and the central bank may lay the ground works to start normalizing monetary policy as the recovery gets on a more sustainable path. With this in mind, I expect the correlation between risk and the USD to decouple later on this year and the greenback should show a greater reaction to the developments coming out of the world’s largest economy as speculation for QE3 diminish.

Q: The NZD/USD has been on a roll basically since the end of December and has been trading at its highest level since early September. Can you comment on this pair and what you feel has been the driver behind the recent ascent? Also, do you feel we will see higher levels still?

Interest rate expectations have certainly helped to prop up the NZD/USD as the Reserve Bank of New Zealand strikes an improved outlook for the region. As the RBNZ expects the rebuilding efforts from the Christchurch earthquake to foster a stronger recovery, the central bank is widely expected to lift the benchmark interest rate from the record-low and we may see a series of rate hikes in the second-half of the year as economic activity picks up. In turn, speculation for higher borrowing costs should prop up the NZD/USD throughout the first-half of the year, but currency traders may become bearish against the New Zealand dollar should the central bank further delay the normalization of monetary policy.

Q: We have seen major upward movement in the USD/JPY in the past few weeks after trading in a relatively tight range for a long while and, in fact, the Yen has been very weak against the other major currencies. Can you explain why you feel the Yen has been weak and where do you see this currency over the short to medium term?

The USD/JPY broke out of its narrow range after the Bank of Japan expanded its asset purchase program by JPY 10 trillion, but the widening spread between U.S. and Japanese government bonds foreshadows a bullish outlook for the pair as it raises the appeal of reserve currency. The renewed efforts by the BoJ to stem the risk for contagion suggests that the central bank will further increase its asset purchase program amid the slowdown in the global economy and the pair should continue to retrace the sharp selloff from the previous year as it breaks out of the multi-year downward trend. In turn, we expect the USD/JPY to work back towards the 2011 highs around 85.50, but the bullish momentum underlining the dollar-yen may produce a test of 90.00 over the medium-term as the fundamental outlook for the world’s largest economy improves.

Q: Oil prices are trading above $100 per barrel now and there is much speculation that prices will be heading higher as tension in the MiddleEast with Iran continues to flare up. If oil prices do continue higher, what currencies do you see as benefitting the most or losing the most from this circumstance?

Indeed, tension in the Middle East pushed oil above $100 per barrel and the geopolitical risks surrounding the world economy is likely to keep crude prices elevated over the near-term amid fears of a supply-side shock. The Canadian dollar tends to benefit from higher oil prices amid the historical correlation between the two asset classes, but the recent strength in crude is likely to taper off later this year as the fundamental outlook for the world economy deteriorates. As the slowdown in global growth becomes an increased concern, expectations for lower demands are likely to bear down on commodity prices and we expect to see crude prices fall back towards $80 per barrel going into the second-half of the year.

Currency Futures Speculators raised US Dollar long positions last week

admin — Mon, 20 Feb 2012 00:31:06 +0000

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators added to their overall US dollar long positions last week for the first time in three weeks and Euro short positions increased after falling for two consecutive weeks.

Non-commercial futures traders, including hedge funds and large speculators, increased their total US dollar long positions to $16.98 billion on February 14th from a total long position of $10.63 billion on February 7th, according to the CFTC COT data and calculations by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.

Individual Currencies:

EuroFX: Currency speculators were back to increasing their Euro short positions following two consecutive weeks of declining shorts. The positions are still higher than when the euro registered a new record high for euro shorts on January 24th at a total of 171,347 contracts. Euro net short positions advanced to 148,641 contracts against the currency on February 14th from the previous week’s total of 140,593 net short contracts.

GBP: British pound sterling positions declined for a second consecutive week to the lowest level in a month, according to the data as of February 14th. British pound positions saw a total of 40,599 net short positions on February 14th following a total of 33,122 net short positions registered on February 7th.

JPY: The Japanese yen net long speculative contracts fell sharply last week to decline for a second consecutive week, according to the data on February 14th. Yen long positions dropped to a total of 29,459 net contracts reported on February 14th following a total of 55,171 net long contracts on February 7th. Yen speculative positions have now fallen to their lowest level since December 27th when positions totaled 22,585 contracts.

CHF: Swiss franc speculators rose their short bets against the Swiss currency to the highest level in at least four years last week. Speculator positions for the Swiss currency futures numbered a total of 15,863 net short contracts on February 14th following a total of 9,795 net short contracts as of February 7th.

CAD: Canadian dollar positions rose higher after surging the previous week to the best total long position in four months. Canadian dollar positions rose to a total of 9,566 net long contracts as of February 14th following a total of 2,184 short contracts that were reported for February 7th. CAD positions are now at their highest position since late August when long contracts equaled 13,939.

AUD: The Australian dollar long positions dipped slightly for the second consecutive week following a run of six consecutive weekly increases through January 31st. Australian dollar positions decreased to a total net amount of 73,741 long contracts on February 14th after totaling 75,095 net long contracts reported as of February 7th. The AUD speculative positions were at their highest level in six months when Australian dollar long positions totaled 81,438 on January 31st.

NZD: New Zealand dollar futures speculator positions advanced higher and rose for an eighth consecutive week through February 14th. NZD contracts increased to a total of 23,870 net long contracts as of February 14th following a total of 23,335 net long contracts on February 7th. NZD positions have now risen for eight straight weeks after touching a nine-month low on December 20th. NZD contracts have ascended to the highest level since August 2nd when net long contracts totaled 24,126.

MXN: Mexican peso speculative contracts improved for a sixth straight week and are now at the best position since August 9th. Peso long positions numbered a total of 41,239 net long speculative positions as of February 14th following a total of 34,107 long contracts that were reported for February 7th.

COT Currency Data Summary as of February 14, 2012
Large Speculators Net Positions vs. the US Dollar

EUR -148641
GBP -40599
JPY +29459
CHF -15863
CAD +9566
AUD +73741
NZD +23870
MXN +41239

Other COT Trading Resources:

Trading Forex Using the COT Report

Currency Futures: Forex Speculators cut Dollar Long Positions as Canadian Loonie positions turn long while Kiwi surges

admin — Mon, 13 Feb 2012 00:30:15 +0000

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators decreased their US dollar long positions last week and Euro short positions improved for the second straight week off their record low level.

Non-commercial futures traders, usually hedge funds and large speculators, decreased their total US dollar long positions to $10.63 billion on February 7th from a total long position of $14.22 billion on January 31st, according to the CFTC COT data and calculations by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.

Individual Currencies:

EuroFX: Currency speculators decreased their Euro short positions for a second consecutive week as of February 7th after registering a new record high for euro short bets on January 24th. Euro net short positions totaled 140,593 short bets against the euro currency from the previous week’s total of 157,546 net short contracts.

GBP: British pound sterling positions declined after two weeks of improvement, according to the data as of February 7th. British pound positions saw a total of 33,122 short positions on February 7th following a total of 26,214 net short positions registered on January 31st.

JPY: The Japanese yen net long speculative contracts dipped last week after increasing the previous week, according to the latest data on February 7th. Yen long positions fell to a total of 55,171 net long contracts reported on February 7th following a total of 56,669 net long contracts that were reported on January 31st. Yen speculative positions are still just below their highest level in over a year that was registered on January 10th when contracts surpassed the August 2nd level of 58,833 contracts.

CHF: Swiss franc speculators slightly decreased their short bets against the Swiss currency for a third consecutive week as of February 7th. Speculator positions for the Swiss currency futures numbered a total of 9,795 net short contracts on February 7th following a total of 11,222 net short contracts as of January 31st. Swiss contracts had been on the short side by more than 10,000 contracts for six consecutive weeks before last week’s slight turnaround.

CAD: Canadian dollar positions surged higher and crossed over to a total long position for the first time since the beginning of September. Canadian dollar positions rose to a total of 2,184 net long contracts as of February 7th following a total of 19,409 short contracts reported on January 31st. CAD positions are now at their highest position since September 6th when long contracts equaled 2,081.

AUD: The Australian dollar long positions dipped slightly after increasing for six consecutive weeks. Australian dollar positions decreased to a total net amount of 75,095 long contracts on February 7th after totaling 78,044 net long contracts reported as of January 31st. The AUD speculative positions were at their highest level on January 31st since July 26th when Australian dollar long positions totaled 81,438.

NZD: New Zealand dollar futures speculator positions surged higher and advanced for a seventh consecutive week through February 7th. NZD contracts increased to a total of 23,335 net long contracts as of February 7th following a total of 14,797 net long contracts on January 31st. NZD positions have now risen for seven straight weeks from the December 20th low standing and to the highest level since August 2nd when net long contracts equaled 24,126.

MXN: Mexican peso speculative contracts improved for a fifth consecutive week and rose to the best position since August 9th against the US dollar. Peso long positions numbered a total of 34,107 net long speculative positions as of February 7th following a total of 21,481 long contracts that were reported on January 31st. Peso contracts crossed over into a positive long position on January 24th for the first time since September 6th and now has been on the long side for three consecutive weeks.

COT Currency Data Summary as of February 7, 2012
Large Speculators Net Positions vs. the US Dollar

EUR -140593
GBP -33122
JPY +55171
CHF -9795
CAD +2184
AUD +75095
NZD +23335
MXN +34107

Other COT Trading Resources:

Trading Forex Using the COT Report

Currency Futures: Forex Speculators cut US Dollar bets. Aussie, Kiwi & Peso positions continue rise

admin — Sun, 05 Feb 2012 19:56:21 +0000

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators cut back on their US dollar long positions last week and Euro short positions improved for the first time in six weeks from their record low level.

Non-commercial futures traders, usually hedge funds and large speculators, decreased their total US dollar long positions to $14.22 billion on January 31st from a total long position of $20.09 billion on January 24th, according to the CFTC COT data and calculations by Reuters which calculates the dollar positions against the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc.

Individual Currencies:

EuroFX: Currency speculators decreased their Euro short positions for the first time in six weeks as of January 31st after raising their short bets to a new record high the previous week. Euro net short positions totaled 157,546 short bets against the euro currency from the previous week’s total of 171,347 net short contracts.

GBP: British pound sterling positions showed improvement for a second consecutive week and increased to their best level since December 20th. British pound positions saw a total of 26,214 short positions on January 31st following a total of 31,361 net short positions registered on January 24th, according to the CFTC data.

JPY: The Japanese yen net long speculative contracts reversed two consecutive weeks of declines, according to the latest data on January 31st. Yen long positions increased to a total of 56,669 net long contracts reported on January 31st following a total of 44,367 net long contracts that were reported on January 24th. Yen speculative positions are just below their highest level in over a year that was registered on January 10th when contracts surpassed the August 2nd level of 58,833 contracts.

CHF: Swiss franc speculators slightly trimmed their short bets against the Swiss currency for a second consecutive week as of January 31st. Speculator positions for the Swiss currency futures numbered a total of 11,222 net short contracts on January 31st following a total of 12,514 net short contracts as of January 24th. Swiss contracts have now been on the short side by more than 10,000 contracts for six consecutive weeks and positions have seen limited movements either way.

CAD: Canadian dollar positions slightly declined after improving the previous week for the first time in three weeks. Canadian dollar positions declined to a total of 19,409 net short contracts as of January 31st following a total of 18,909 short contracts reported on January 24th. CAD positions on January 17th had marked their lowest level in over a year and a total of 28,730 net short contracts.

AUD: The Australian dollar long positions continued higher for a sixth consecutive week as of January 31st. Australian dollar positions increased to a total net amount of 78,044 long contracts on January 31st after totaling 69,486 net long contracts reported as of January 24th. The AUD speculative positions are now at their highest level since July 26th when Australian dollar long positions totaled 81,438.

NZD: New Zealand dollar futures speculator positions rose higher and advanced for a sixth consecutive week through January 31st. NZD contracts increased to a total of 14,797 net long contracts as of January 31st following a total of 12,932 net long contracts on January 24th. NZD positions have now risen for six straight weeks from the December 20th low standing (which was the lowest position since March 29th when positions equaled 239 long contracts) and to the highest level since September 13th when net long contracts equaled 17,664.

MXN: Mexican peso speculative contracts improved for a fourth consecutive week and rose to the best position since August 23rd against the US dollar. Peso long positions numbered a total of 21,481 net long speculative positions as of January 31st following a total of 7,418 long contracts that were reported on January 24th. Peso contracts crossed over into a positive long position on January 24th for the first time since September 6th.

COT Currency Data Summary as of January 31, 2012
Large Speculators Net Positions vs. the US Dollar

EUR -157546
GBP -26214
JPY +56669
CHF -11222
CAD -19409
AUD +78044
NZD +14797
MXN +21481

Other COT Trading Resources:

Trading Forex Using the COT Report

Currency Futures: Forex Speculators raise Euro bearish bets. Aussie, Kiwi & Mexican Peso bets rise

admin — Mon, 30 Jan 2012 14:33:52 +0000

By CountingPips.com

The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators continued to pile into bets against the European common currency for a fifth consecutive week.

Non-commercial futures traders, usually hedge funds and large speculators, added to their short positions for the euro while trimming short positions in the British pound sterling, Swiss franc and the Canadian dollar. The Australian dollar, New Zealand dollar and the Mexican peso saw higher long positions directly against the US dollar while the Japanese yen decreased for a second consecutive week.

Individual Currencies:

EuroFX: Currency speculators added more to their Euro short positions for a fifth week as of January 24th and raised their short bets to a new record high once again. Euro short positions totaled 171,347 net short contracts from the previous week’s total of 160,030 net short contracts as speculator sentiment for the common European currency for futures speculators remained dismal last week.

GBP: British pound sterling positions showed improvement following four consecutive weeks of declines as of January 24th. British pound positions saw a total of 31,361 short positions on January 24th following a total of 41,634 net short positions registered on January 17th.

JPY: The Japanese yen net long speculative contracts declined lower for a second consecutive week, according to the latest data on January 24th. Yen long positions decreased to a total of 44,367 net long contracts reported on January 24th following a total of 58,862 net long contracts that were reported on January 17th. Yen speculative positions on January 10th had registered their highest level in over a year surpassing the August 2nd level when long positions leveled at 58,833 contracts.

CHF: Swiss franc speculators slightly trimmed their short bets against the Swiss currency as of January 24th although positions have barely changed in the past four weeks. Speculator positions for the Swiss currency futures numbered a total of 12,514 net short contracts on January 24th following a total of 12,822 net short contracts as of January 17th. Swiss contracts have now been on the short side by more than 10,000 contracts for five consecutive weeks.

CAD: Canadian dollar positions improved after declining for three consecutive weeks. Canadian dollar positions improved to a total of 18,909 net short contracts as of January 24th following a total of 28,730 short contracts reported on January 17th. CAD positions on January 17th marked their lowest level in over a year.

AUD: The Australian dollar long positions continued higher for a fifth consecutive week as of January 24th. Australian dollar positions increased to a total net amount of 69,486 long contracts on January 24th after totaling 54,306 net long contracts reported as of January 17th. The AUD speculative positions are at their highest level since August 2nd when Australian dollar long positions totaled 75,598.

NZD: New Zealand dollar futures speculator positions rose higher and increased for a fifth consecutive week through January 24th. NZD contracts advanced to a total of 12,932 net long contracts as of January 24th following a total of 9,455 net long contracts on January 17th. NZD positions have now risen for five straight weeks from the December 20th low standing (which was the lowest position since March 29th when positions equaled 239 long contracts) to the highest level since September 20th.

MXN: Mexican peso speculative contracts improved for a third consecutive week and crossed back over to a positive long position against the US dollar. Peso long positions numbered a total of 7,418 net long speculative positions as of January 24th following a total of 17,328 net short contracts that were reported on January 17th. Peso contracts are now in a positive long position for the first time since September 6th win contracts were positive by 13,246.

COT Currency Data Summary as of January 24, 2012
Large Speculators Net Positions vs. the US Dollar

EUR -171347
GBP -31361
JPY +44367
CHF -12514
CAD -18909
AUD +69486
NZD +12932
MXN +7418

Other COT Trading Resources:

Trading Forex Using the COT Report

Forex Interview: John Kicklighter of DailyFx shares his views on the Euro, USD, Yen and latest Currency Trends

admin — Wed, 25 Jan 2012 14:11:07 +0000

By Zac Storella, CountingPips.com

Today, I am pleased to share our latest forex interview on the latest major forex events and currency trends with John Kicklighter, Senior Currency Strategist at DailyFx.com. John specializes in fundamental analysis and overall market themes and has trading experience in spot currency, financial futures, commodities, stocks, and options. In his analysis for DailyFx, John’s regularly reports on G10 fundamental forecasts, global risk sentiment and carry trade analysis while his commentary has been featured in many publications including Bloomberg, Reuters, CNBC, AFP, and The Australian.

This week happens to be a relatively busy week of US economic data releases that includes the GDP report, an interest rate decision, home sales data and the durable goods report. What do you feel will be the one or two most important events and themes to pay attention to for the week and for the rest of January?

All of the economic data that is scheduled for release through the immediate future will play a role in shaping expectations for the relative health of the United States – an important consideration when there is a very real threat of recession for many of its most prominent counterparts. However, most individual indicators (like the housing data, durable goods orders and for that matter, probably even next week’s NFPs) will not significantly alter the larger consensus trend. The exception is the first reading of 4Q GDP. This figure can confirm or deny the market consensus, and catching market participants off guard on a big theme like this is a rare enough event that its impact is leveraged. Tapping the more elemental consideration of risk/reward, the FOMC decision could also be a market mover as it will offer a better framework for further stimulus and the eventual withdrawal of easy money. This particular meeting is a unique event as they will start producing interest rate forecasts along with their updates on growth and policy bearings. These are the known and definitive considerations. Real impact potential though comes from the unknown – speculation of QE3 and progress on the most recent ‘hope revival’ for the euro.

The EUR/USD has broken above the 1.30 level this week in trading. Do you feel the EUR/USD can sustain this momentum at these levels and perhaps ascend higher?

From a purely fundamental perspective, I think the euro has no business posting a meaningful advance. That said, this isn’t an academically-based fundamental world. Sentiment determines when a currency needs to be repriced. That being said, the market will itself to be caught up in the hope that additional stimulus is coming through for the Euro-area and that the Greek situation will be reconciled because the short-side is temporarily oversaturated. Though not a full representation of the spot market (due to difference in market depth and participation) the COT report of net speculative interest in Euro futures set a record level of shorts through the week ending Tuesday. Often, when we reach these extremes, it is a sign that one side of the market has been exhausted and a correction would be easier to facilitate. Given the depths the euro has plunged on an exchange rate and futures positioning basis, a bigger rebound wouldn’t be too hard to facilitate.

Seeing the CFTC futures speculators data showed that specs were still very euro-bearish last week, do you feel we could perhaps see a change in sentiment (a bottom reached and/or a short squeeze?)?

The CFTC’s Commitment of Traders report measures open positions to the Tuesday of that week. Therefore, the record net short exposure reading that we were given was not representative of the big Euro rally on Wednesday and Thursday. There is a good chance that exposure will see a correction with the next reading to account for the recent change in EURUSD’s bearing (even if it is temporary). That said, a quick reversal (in either price or extreme positioning) doesn’t necessarily guarantee a larger trend reversal. It’s important to remember in these times that there are corrections in larger trends.

What do feel is propelling the AUD/USD and the NZD/USD higher at this point? They are now respectively trading at their highest levels since October. Despite the AUD and NZD’s correlation to risk, these two pairs have largely avoided the euro’s slide of the last few months.

The euro itself is not a good representation of risk. We have seen the correlation between EURUSD and the S&P 500 (my favored gauge for risk appetite) deteriorate significantly over the past week. Anything can be a catalyst for broader risk aversion, but it doesn’t guarantee that everything and anything will do it. Through the euro’s recent slide, we have seen demand for equities slowly but steadily chop higher to five month highs. It is this acceptance of risk and appetite for higher yield that is encouraging capital to flow over to the higher yielding currencies.

The USD/JPY has been trading in a relatively tight range since the beginning of the new year roughly between 76.50 and 77.50. Do you see any catalyst upcoming that might be able to allow a breakout of this range? Likely more of the same sideways action?

The US dollar and Japanese yen are frustratingly, evenly matched as safe havens – that is in tolerable market conditions (should the very stability of the world’s financial markets come into question, capital will move over to the US dollar and its Treasuries, no questions asked). With volatility behind risk trends smoothing out, the need to favor a particular low-yield and deep-market currency diminishes significantly. Clearly, a crisis of global proportions could encourage a shift to the safety of the US market. In the absence of that overwhelming catalyst, we still have the possibility of BoJ intervention (though it seems they are looking at both EURJPY and USDJPY for inspiration).

As we have entered a new year, do you have any predictions for winners or losers over the first half of the year in terms of specific currencies and trends? Any other markets you feel may have a bearing on the major currencies?

Given the heights equities (and exposure to risk in general) have marched to, a bigger correction in long-risk exposure is highly probable. That means, high yield currencies, equities, speculative commodities, and high-yield paper are at risk of a deep correction. And, if all come under significant enough pressure at the same time, we could possibly see the funding markets freeze up; which is a crisis unto itself. In a regular risk aversion scenario, we can see the US dollar and Japanese yen advance for currencies while government paper and money markets for the US, UK, Germany and Japan swell. After such a down leg, we could see one of two scenarios. A short-term downdraft would see the Fed or some other equally dedicated policy authority step in with an artificial booster in the form of stimulus. Otherwise, a longer deleveraging would eventually flag and send too much capital to the sidelines – and the void would eventually need to be filled so market participants can make money and possibly take advantage of considerable discounts (after a meaningful reduction in cost).

Thank you John for taking the time to answer my questions in this week’s forex interview. To read John’s latest currency analysis and trading strategies you can visit DailyFx.com. Find more information to follow John below.

John Kicklighter
PHONE: (415) 343-4923
EMAIL: jkicklighter@fxcm.com
LOCATION: San Francisco
TWITTER: @JohnKicklighter