Speculators Reduce USD Long by Over 45,000 Contracts

Commitment of Traders (COT) Report 24 July 2012. The latest COT report shows that speculators reduced their net USD long by 45,518 contracts. 

The biggest shifts occurred in the yen and the Australian Dollar.  In the yen speculators flipped from a net short position of 7,323 to a net long of 12,201 contracts.  The Australian Dollar benefitted from a buying surge by the large specs that took the total net spec long up to almost 25K.

The biggest short position has been in the euro, but this short euro/long USD position was reduced by only 10K in the period.  It should be noted that the cut-off date for this report is a Tuesday.  After the cut-off date the ECB announcement that the euro would be defended made the euro and other markets firmer against the USD.  We expect further reductions in USD longs in the next report.

This is the smallest USD long position since the report of May the 22nd.

  • US Dollar Index: There were very small changes in the DI during the period.  Large specs are a 7.7 ratio long and the small ones are a 6.4 ratio long.  Both spec groups made small additions to their longs.
  • Euro (EUR/USD): Spec remain the big shorts in the euro, but did reduce their short positions to 194,930 contracts, down from 205021 in the previous period.  The large specs are a 5 to 1 ratio short.  Spreading or options trade has increased to 40,025 contracts, or 10.2% of the total open interest.
  • British Pound Sterling (GBP/USD): Both spec groups reduced both their longs and their shorts in the pound.  They remain short the pound but the total net pound short has been reduced to 16,947 contracts.  The bulk of this short is held by the small specs.
  • Japanese Yen (JPY/USD):  The large spec increased his net long in the yen by over 14K, and at the same time the small spec reduced his net short by 6K.  The bottom line is the specs collectively are now long the yen and short the USD.  Commercials on the opposite side of the trades flipped to the short side of the yen.
  • Swiss Franc (CHF/USD): Specs continue to favour the short side of the SF.  The total collective spec net short is up to 42,329 contracts.  The large specs are better than a 6 ratio short.  The OI in the SF is high, 65,613 contracts.
  • Canadian Dollar (CAD/USD):  It is very peculiar to see the composition of a market like we have in the C$.  Opinions are evenly balance by all groups, so as a result there is a very small net position.  No one knows what to do.  When someone gets an idea and the money starts to flow into the loonie, it might be best to go with the money flow.
  • New Zealand Dollar (NZD/USD): There was a slight increase in the long spec positions of the Kiwi.  The large long is now up to 8657 contracts.  The large spec is a 3 ratio long in this very small market.
  • Australian Dollar (AUD/USD):  The OI grew almost 11K contracts as the large specs added to their long A$ position.  Small specs are short the Aussie but they have been reducing that position and are now almost even.  There were three strong days in the Aussie after the cut off for this report so I would expect next week’s report to show the small spec has flipped to the long side of the A$.

Written by CashBackForex.com