Currency Speculators raised US Dollar bearish bets for 1st time in 7 weeks

June 9, 2018

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US Dollar net speculator positions leveled at $-5.54 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 increased their aggregate bearish bets for the US dollar this week.

Non-commercial large futures traders, including hedge funds and large speculators, had an overall US dollar net position totaling $-5.54 billion as of Tuesday June 5th, according to the latest data from the CFTC and dollar amount calculations by Reuters. This was a weekly decline of $-0.69 billion from the $-4.85 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).

The aggregate speculative positions had risen for six straight weeks to the least bearish level since January 2nd before bearish bets rose this week. Overall, the dollar position remains in bearish territory for a 47th consecutive week dating back to July 18th 2017.


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Weekly Speculator Contract Changes: Peso plunge continues into bearish territory

This week saw just one substantial changes (+ or – 10,000 contracts) in the individual currency contract level for the speculators category.

Mexican peso speculative bets continued to decline sharply and fell by at least -10,000 contracts for a fourth straight week. This week the MXN bets decreased by -29,446 contracts. Overall, the speculator peso bets have now dropped for eight straight weeks and the MXN spec position dipped into a bearish position for the first time since April 11th of 2017.

Overall, the major currencies that improved against the US dollar this week were the Japanese yen (4,599 contracts), Swiss franc (4,215 contracts), Australian dollar (3,027 contracts) and the New Zealand dollar (2,982 contracts).

The currencies whose speculative bets declined this week versus the dollar were the euro (-3,801 weekly change in contracts), British pound sterling (-2,132 contracts), Canadian dollar (-349 contracts) and the Mexican peso (-29,446 contracts).

 

Table of Weekly Commercial Traders and Speculators Levels & Changes:

Currency Net Commercials Comms Weekly Chg Net Speculators Specs Weekly Chg
EuroFx -94,602 16,431 89,236 -3,801
GBP 3,799 8,010 7,345 -2,132
JPY 9,747 -6,792 -3,437 4,599
CHF 62,451 1,537 -39,216 4,215
CAD 20,361 1,384 -16,039 -349
AUD 36,602 -4,720 -20,208 3,027
NZD -675 -3,161 4,383 2,982
MXN 13,952 30,613 -11,110 -29,446

 

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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