Forex Speculators edged Dollar Index bets higher, Euro goes bearish, Yen bets drop

October 6, 2018

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US Dollar Index Non-Commercial Speculator Positions:

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 speculators slightly added to their bullish bets for the US Dollar Index while sharply betting against the euro and the Japanese yen this week.

The non-commercial futures contracts of US Dollar Index futures, traded by large speculators and hedge funds, totaled a net position of 37,036 contracts in the data reported through Tuesday October 2nd. This was a weekly increase of 27 contracts from the previous week which had a total of 37,009 net contracts.

US Dollar Index speculators slightly edged their bets higher this week and have now increased their bets for twenty-two out of the past twenty-four weeks. The current standing is above the +37,000 net contract level for a third straight week and above the +30,000 contract level for a ninth straight week.


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Aggregate US Dollar Position goes higher this week

US Dollar net speculator positions rose to $26.68 billion this week

An aggregate measure of the US dollar position – the total of US dollar contracts against the combined contracts of the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc – rose to an overall US dollar net position totaling $26.68 billion as of Tuesday October 2nd, according to the latest data from the CFTC and dollar amount calculations by Reuters. This was a weekly rise of $3.51 billion from the $23.17 billion total position that was registered the previous week, according to the Reuters calculation.

The aggregate dollar position has now risen for three straight weeks and by a total of $7.52 billion over that span. The current level is at the highest standing since December 13th of 2016 when the aggregate totaled $28.01 billion.


Individual Currencies Data this week:

In the individual currency contracts data, we saw three substantial changes (+ or – 10,000 contracts) in the speculators category.

Euro speculators pushed their net position back into bearish territory this week as bets fell by -10,797 contracts. This is the first bearish standing for the euro since the end of August.

Japanese yen speculators boosted their bearish bets for the fifth straight week and by over -20,000 bets for the second straight week. The current standing for the yen has now fallen to the most bearish level since February 13th of this year when the net position totaled -115,509 contracts

Mexican peso bullish bets continued their upward trajectory and rose by over +20,000 contracts this week – the third straight week of at least +10,000 contract gains. The current net position overall has increased for four straight weeks and is at the highest bullish level since May 8th

The major currencies that improved this week were the British pound sterling (7,738 weekly change in contracts), US Dollar Index (27 contracts), Swiss franc (2,681 contracts), Canadian dollar (1,048 contracts), Australian dollar (343 contracts), New Zealand dollar (1,239 contracts) and the Mexican peso (22,431 contracts).

The currencies whose speculative bets declined this week were the euro (-10,797 weekly change in contracts) and the Japanese yen (-29,327 contracts).

See the table and individual currency charts below.


Table of Weekly Commercial Traders and Speculators Levels & Changes:

Currency Net Commercials Comms Weekly Chg Net Speculators Specs Weekly Chg
EuroFx -9,500 27,230 -7,101 -10,797
GBP 78,665 -9,762 -59,340 7,738
JPY 136,000 22,843 -114,046 -29,327
CHF 23,096 1,573 -13,402 2,681
CAD 10,287 -6,244 -18,484 1,048
AUD 90,247 -3,264 -71,718 343
NZD 35,295 -231 -30,596 1,239
MXN -77,247 -21,611 73,829 22,431

 

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