COT: EUR long extends on Trump threat
The gross-long hit an 18-month high at $21 billion with selling of JPY, GBP, CHF, and AUD more than offsetting a 38% jump in the EUR net-long. The latter most likely came in response to President Trump’s renewed attack on the strong dollar, not least against the euro and the Chinese yuan.
Rangebound trading around 0.74 in the AUD has not prevented a continued rise in bearish bets. Last week the net-short reached 45,486 lots, the highest since December 2015.
Bonds: In fixed income, leveraged traders bought two- and five-year maturities while selling 10-years and Treasury bonds. The curve-steepening trades were initiated following President Trump’s July 19 Fed comments in which he expressed displeasure about rising interest rates.
The net-short in US 10-year notes reached a fresh record of 655,596 lots as the yield moved higher towards 3% ahead of last Friday’s Q2 GDP report.
Stocks: The S&P 500 was sold while small buying of the Nasdaq was seen ahead of key company results from Alphabet, Facebook, and Amazon.