CFTC Commitments of Traders Report, 13 November 2012. Once again the currency specs reduced their aggregate USD short position, and this time they took it down to only 5,960 contracts. This compares to 42,996 contracts last week and 152,994 contracts four weeks ago.
Within the total numbers are some interesting trends. Most notable is the position in the euro and because of the peg to the euro the Swiss Franc. The euro short increased from 91,504 contracts to 104,310 contracts, and the SF increased from a short of 3,722 contracts to 14,439 contracts.
Currency traders have been long the so called commodity currencies prompted by experience from prior QE and money expansion policies that has increased commodity prices. They loaded up long the Australian, New Zealand and Canadian Dollar with Bernanke’s last QE announcement in September. The specs remain long 178,611 contracts, down from 189, 781 in the previous week.
- US Dollar Index: Small flipped their position to the long side and joined large specs that were already long. This market is dominated by the large specs who were long 70.1% and short 57.3% of the total market.
- Euro (EUR/USD): The total spec short in the euro grew to 104.3K, up from 91.5K in the previous week. Large specs are now over a 3 ratio short. Spreading (options) went down to 8.8% with the expiration of the November contracts.
- British Pound Sterling (GBP/USD): Both spec groups had been long the pound, and both groups reduced their long, but did not flip positions. The large spec reduced his net long by 11.5K contracts and is now long less than 19K contracts. Market action had been favoring the pound shorts, so we saw liquidation on the spec longs.
- Japanese Yen (JPY/USD): Both the large and small specs reduced short positions in the yen from 85K to 71.9K. After the cut-off date for this report, the yen broke to a new low versus the USD and many other currencies. Small specs are a 4-ratio short, and the large spec is better than a 2-to-1 short.
- Swiss Franc (CHF/USD): This is not a large market, but there was a large shift by specs to the short side of the SF. Combined the two specs groups are better than a 2-ratio short.
- Canadian Dollar (CAD/USD): Large specs made a 9.7K reduction in their net C$ long but they remain a 8.7 ratio long. The combined spec long in the C$ is still quite large, 83.8K. The loonie has been stuck in a trading range that seems to have a slightly negative bias, and is thereby hurting the price, but commodity currencies still remain popular.
- New Zealand Dollar (NZD/USD): Specs gave up about 1.K contracts of their net long, but remained long 21.5K contracts. The large spec is a 5.2 ratio long and the small spec is a 2.2 ratio long. The Kiwi had been under some mild pressure at the end of the period, but the market has now reversed.
- Australian Dollar (AUD/USD): Small specs modestly reduced their A$ long but the large spec added to their longs. The total spec long went up to 76.2K from 74.3K just a week ago. Large specs are better than a 2.5 ratio long. The trend in the A$ has been sideways, though there was been an upturn yesterday.
Written by CashBackForex.com