Video

John J Hardy
Saxo Bank’s head of FX strategy John Hardy takes a closer look at trends and moves in today’s forex charts, including EURUSD, USDJPY, AUDUSD, and EURSEK.
Article / 11 December 2017 at 8:10 GMT

COT: Short dollar position expands again — #SaxoStrats

Head of Commodity Strategy / Saxo Bank
Denmark
  • CHF, NZD saw short-covering last week
  • Speculators hiked bearish bets on US bonds
  • Dow, S&P 500 buying offsets Nasdaq 100 selling

EUR
The EUR remained the favoured long trade last week. Photo: Shutterstock

By Ole Hansen

After almost hitting neutral four weeks ago the combined short dollar position against eight IMM currency futures increased again last week, this time by 8% to $6 billion. 

Short-covering of CHF and NZD combined with additional buying of GBP, AUD, MXN, and not least EUR more than offset fresh selling of the JPY and CAD long liquidation. 

Speculative IMM currency positioning

Speculative IMM currency positioning




























While the JPY is the most shorted, the EUR remains the favored currency with the net-long having hardly moved during the past five months.

Speculative positioning in IMM EUR and JPY
 
Financials

Bonds: Speculators overall increased bearish bets on US bonds while adding to curve-flattening trades ahead of this weeks FOMC rate decision meeting on Wednesday. This resulted in selling at the front of the curve, not least of  2's and 5's while ultra 10's and T-bonds where bought. The net-long on the latter reached a 20-month high.

Stocks: The combined net-short position held by leveraged traders in US stock index futures dropped to the lowest for the year. Buying of the Dow Jones and the S&P 500 in particular more than offset a reduction in the tech-heavy Nasdaq 100. 

Speculative positioning in Financials
 
— Edited by Michael McKenna

Ole Hansen is head of commodity strategy at Saxo Bank 
Download document

Commitments of Traders: IMM Currency Futures

Download document

Commitments of Traders: Bonds and stock index futures

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