Speculators trim US Dollar Index bets, push Japanese Yen bullish bets higher

August 18, 2019

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US Dollar Index Speculator Positions

Large currency speculators cut back on their bullish bets in the US Dollar Index futures markets this week, according to the latest Commitment of Traders (COT) data released by the Commodity Futures Trading Commission (CFTC) on Friday.

The non-commercial futures contracts of US Dollar Index futures, traded by large speculators and hedge funds, totaled a net position of 29,842 contracts in the data reported through Tuesday August 13th. This was a weekly lowering of -1,487 contracts from the previous week which had a total of 31,329 net contracts.

This week’s net position was the result of the gross bullish position (longs) falling by -1,457 contracts (to a weekly total of 47,874 contracts) compared to the gross bearish position (shorts) which rose by 30 contracts on the week (to a total of 18,032 contracts).

Large speculators cooled off on their bullish bets for the USD Index this week following six straight weeks of gains. The current speculative position remains strongly bullish but has fallen below the +30,000 net contract level for the first time in three weeks.


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Individual Currencies Data this week:

In the other major currency contracts data, we saw just one substantial change (+ or – 10,000 contracts) in the speculators category this week.

Japanese yen positions rose for a fourth straight week and by over +14,000 net contracts for a second straight week. Yen positions turned from overall bearish to bullish just last week and are now at the most bullish level since November 8th of 2016 (a span of 144 weeks).

Overall, the major currencies that saw improving speculator positions this week were the British pound sterling (6,882 contracts), Japanese yen (14,181 contracts) and the Swiss franc (3,479 contracts).

The currencies whose speculative bets declined this week were the US dollar index (-1,487 weekly change in contracts), euro (-2,639 weekly change in contracts), Canadian dollar (-9,966 contracts), Australian dollar (-7,401 contracts), New Zealand dollar (-1,883 contracts) and the Mexican peso (-4,507 contracts).


Chart: Current Strength of Each Currency compared to their 3-Year Range

See the table and individual currency charts below.


Table of Large Speculator Levels & Weekly Changes:

Currency Net Speculator Position Specs Weekly Change
USD Index 29,842 -1,487
EuroFx -46,649 -2,639
GBP -95,820 6,882
JPY 24,742 14,181
CHF -12,952 3,479
CAD 14,200 -9,966
AUD -62,912 -7,401
NZD -13,447 -1,883
MXN 117,562 -4,507

 

This latest COT data is through Tuesday and shows a quick view of how large speculators or non-commercials (for-profit traders) 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:

The Euro large speculator standing this week reached a net position of -46,649 contracts in the data reported through Tuesday. This was a weekly lowering of -2,639 contracts from the previous week which had a total of -44,010 net contracts.


British Pound Sterling:

The large British pound sterling speculator level totaled a net position of -95,820 contracts in the data reported this week. This was a weekly gain of 6,882 contracts from the previous week which had a total of -102,702 net contracts.


Japanese Yen:

Large Japanese yen speculators reached a net position of 24,742 contracts in this week’s data. This was a weekly increase of 14,181 contracts from the previous week which had a total of 10,561 net contracts.


Swiss Franc:

The Swiss franc speculator standing this week was a net position of -12,952 contracts in the data through Tuesday. This was a weekly increase of 3,479 contracts from the previous week which had a total of -16,431 net contracts.


Canadian Dollar:

Canadian dollar speculators equaled a net position of 14,200 contracts this week. This was a decrease of -9,966 contracts from the previous week which had a total of 24,166 net contracts.


Australian Dollar:

The large speculator positions in Australian dollar futures reached a net position of -62,912 contracts this week in the data ending Tuesday. This was a weekly decrease of -7,401 contracts from the previous week which had a total of -55,511 net contracts.


New Zealand Dollar:

The New Zealand dollar speculative standing reached a net position of -13,447 contracts this week in the latest COT data. This was a weekly fall of -1,883 contracts from the previous week which had a total of -11,564 net contracts.


Mexican Peso:

Mexican peso speculators reached a net position of 117,562 contracts this week. This was a weekly fall of -4,507 contracts from the previous week which had a total of 122,069 net contracts.


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*COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures 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).