14 August 2017 at 7:33 GMT
- US dollar selling accelerated in week to August 8
- Non-commercial USD short vs eight IMM currency futures jumped 43%
- IMM euro net long reached new six-year high, not far from 2007 record level
- A third week of JPY short-covering put additional pressure on USD
Selling of the US dollar accelerated in the week to August 8. Image: Shutterstock
By Ole Hansen
The non-commercial US dollar short against eight International Monetary Market currency futures jumped 43% in the week to August 8. The IMM euro net long reached a new six-year high, and IMM CAD a 4-½-year high. The latter peak was reached just ten weeks after hitting a record short.
The IMM euro net long reached a new six-year high at 93,685 lots, not far from the 2007 record of 111,000 lots.
A third week of JPY short-covering put some additional pressure on the dollar, while the net long in CAD reached a 4 ½-year high – just ten weeks after hitting a record short.
The short position in US stock index futures hit its second highest level for the year, with funds selling into a new record high just before the correction.
The VIX net short held steady, but the gross short hit a record 350,000 lots just before US president Donald Trump’s "fire and fury" warning to North Korea sent stocks lower and volatility higher.
— Edited by John Acher
Ole Hansen is head of commodity strategy at Saxo Bank