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Cryptocurrencies are gaining ground across Africa. That’s both good news and bad

By Iwa Salami, University of East London

Cryptocurrencies have become popular in African and other developing countries. That’s according to a policy brief released recently by UNCTAD, a United Nations agency. Significant proportions of Kenya (8.5%), South Africa (7.1%) and Nigeria’s (6.3%) populations are using these digital currencies. In June, the Central African Republic adopted bitcoin as a legal tender.

The report warns that widespread use of unregulated digital currencies poses danger to the continent’s financial system. In an interview with The Conversation Africa, Iwa Salami, an expert in financial technology law and regulation, examines the future of digital currencies in Africa.

Why is cryptocurrency becoming popular in Africa?

Cryptocurrencies have gained acceptance among a large proportion of the low-income population that was, previously, financially marginalised. Most banks in Africa were not accessible to this segment. Even when they were, low-income account holders were discouraged by high transaction costs.

Another factor is economic stagnation compounded by debt crises and political instability in African economies since the era of independence. This has resulted in weak currencies ravaged by inflation in countries like Kenya and Nigeria.

Cryptocurrencies promised to address both financial exclusion and the problem of weak domestic currencies.

Cryptocurrency gives everyone with access to a mobile device and internet connectivity the opportunity to engage in activities similar to those conducted through financial institutions and intermediaries. That includes payments, sending remittances and making investments.

Investment is particularly inviting to the technically savvy. It gives them the opportunity to hold assets that aren’t affected by rising inflation and depreciating domestic currencies.

Cryptocurrencies are also quicker, cheaper and easier to use than conventional methods. That’s because the technology facilitates peer-to-peer transactions rather than relying on intermediaries. These currencies were more accessible than traditional banks during the pandemic and lockdowns. This further drove their use and growth across Africa.

What does a high number of people holding cryptos imply?

This can facilitate economic activity in African countries. People with no access to banks and banking services are able to pay for goods and services using cryptos.

Crypto transactions are also believed to be a more secure way of transacting. Unless someone gains access to the private key for your crypto wallet, they cannot sign transactions or access your funds.

The system also facilitates transparency. All cryptocurrency transactions take place on the publicly distributed blockchain ledger. There are tools that allow anyone to look up transaction data – including where, when, and how much of a cryptocurrency someone sent from a wallet address.

But there are risks, too. What are those?

First, cryptocurrencies are very complex. They require a bit of technological astuteness to embrace. A significant proportion of the adult population in sub-Saharan Africa (34.7%) is illiterate and may not be able to grasp it. This, to a certain extent, turns the financial inclusion argument on its head.

Secondly, although it is argued that the blockchain is a more secure way of transacting, the downside, of course, is that if you lose your private key there’s no way to recover your funds. This is a threat that does not exist if you have a bank account.

Thirdly, cryptocurrencies have had a history of volatility, as is currently being experienced in the crypto market). This has adversely affected retail investors, especially those who do not understand this type of asset class.

Another issue of profound concern to African states is the potential threat to monetary sovereignty. Should crypto ever be more widely used than domestic fiat currency, national monetary agencies such as central banks may not be able to steer their economies to a path of growth using monetary policy. Such policy is, after all, primarily administered through domestic currencies.

An associated threat is the weakening of effective capital controls in African states. These are needed to prevent capital flight from domestic economies. Any weakening can result in significant volatility in currency rates and the rapid depreciation of domestic currencies.

There are also threats to financial stability. This could arise from significant exposure that financial institutions, like banks, have to crypto firms such as through loans. Regulation in some African countries, such as Nigeria addresses this by restricting transactions between banks and crypto assets service providers.

What is the future of cryptocurrencies in Africa?

Despite the ongoing downturn in the market, cryptocurrency represents the future of finance and financial transactions. And there are indications that cryptocurrencies are here to stay which is seen from their increasing recognition by countries. At one extreme, the governments of El Salvador and the Central African Republic have adopted bitcoin as legal tender, although the implementation and impact of this on their broader economies have been faced with severe criticisms.

Others, such as Nigeria, have recognised the need for state representation of digital currencies in the form of central bank digital currencies. Many other countries are now exploring this option.

It is important to note, however, that the uptake of central bank digital currencies has been very low in developing countries that have rolled them out. There are also ongoing investigations by countries into the economic impact of central bank digital currencies and whether adoption is the right approach.

But if cryptocurrencies are to live up to their promise, both on the African continent and elsewhere, there must be a globally coordinated and holistic approach to regulation, since transactions are global. Although some action on this front is emerging, the current fragmented approach to regulation across the world is not ideal.

About the Author:

Iwa Salami, Reader (Associate Professor) in Law, University of East London

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Cryptocurrencies Financial News

25 Jul

Murrey Math Lines 25.07.2022 (EURUSD, GBPUSD)

Article By RoboForex.com

EURUSD, “Euro vs US Dollar”

As we can see in the H4 chart, EURUSD is trading below the 200-day Moving Average, thus indicating a descending tendency. In this case, the price is expected to test 3/8, break it, and then continue falling to reach the support at 2/8. Still, this scenario may no longer be valid if the price breaks 4/8 to the upside. After that, the instrument may reverse and grow towards the resistance at 5/8.

In the M15 chart, the pair may break the downside line of the VoltyChannel indicator and, as a result, continue trading downwards.

GBPUSD, “Great Britain Pound vs US Dollar”

As we can see in the H4 chart, GBPUSD is also trading below the 200-day Moving Average to indicate a possible descending tendency. In this case, the price is expected to break 2/8 and continue falling to reach the support at 1/8. However, this scenario may no longer be valid if the price breaks the resistance 3/8 to the upside. After that, the instrument may reverse and grow towards 4/8.

In the M15 chart, the pair may break the downside line of the VoltyChannel indicator and, as a result, continue its decline.

Article By RoboForex.com

Attention!
Forecasts presented in this section only reflect the author’s private opinion and should not be considered as guidance for trading. RoboForex LP bears no responsibility for trading results based on trading recommendations described in these analytical reviews.

Financial News Forex and Currency News

25 Jul

Ichimoku Cloud Analysis 25.07.2022 (GBPUSD, BRENT, USDJPY)

Article By RoboForex.com

GBPUSD, “Great Britain Pound vs US Dollar”

GBPUSD is testing Tenkan-Sen and Kijun-Sen. The instrument is currently moving above Ichimoku Cloud, thus indicating an ascending tendency. The markets could indicate that the price may test the cloud’s upside border at 1.1935 and then resume moving upwards to reach 1.2235. Another signal in favour of a further uptrend will be a rebound from the rising channel’s downside border. However, the bullish scenario may no longer be valid if the price breaks the cloud’s downside border and fixes below 1.1875. In this case, the pair may continue falling towards 1.1685.

BRENT

Brent is falling within the bearish channel. The instrument is currently moving below Ichimoku Cloud, thus indicating a descending tendency. The markets could indicate that the price may test the cloud’s upside border at 103.05 and then resume moving downwards to reach 92.15. Another signal in favour of a further downtrend will be a rebound from the descending channel’s upside border. However, the bearish scenario may no longer be valid if the price breaks the cloud’s upside border and fixes above 106.05. In this case, the pair may continue growing towards 110.55.

USDJPY, “US Dollar vs Japanese Yen”

USDJPY is rebounding from the support area. The instrument is currently moving below Ichimoku Cloud, thus indicating a descending tendency. The markets could indicate that the price may test Tenkan-Sen at 137.00 and then resume moving upwards to reach 133.70. Another signal in favour of a further downtrend will be a rebound from the rising channel’s downside border. However, the bearish scenario may no longer be valid if the price breaks the cloud’s upside border and fixes above 138.75. In this case, the pair may continue growing towards 139.65.

Article By RoboForex.com

Financial News Forex and Currency News

25 Jul

The Analytical Overview of the Main Currency Pairs on 2022.07.25

By JustForex

The EUR/USD currency pair

Technical indicators of the currency pair:

Prev Open: 1.0226
Prev Close: 1.0215
% chg. over the last day: -0.11%

The European Central Bank joined many other central banks in raising interest rates last week as its focus was on fighting inflation rather than a potential economic slowdown. On Friday, ECB chief Christine Lagarde said that the ECB would raise rates as much as needed to bring inflation back to target levels. By narrowing the interest rate differential, the euro has temporarily strengthened. But it should be noted that the US Federal Reserve will raise interest rates by 0.75-1% this week, which will widen the rates spread, causing the EUR/USD quotes to fall below parity again.

Trading recommendations

Support levels: 1.0181, 1.0106, 1.0035, 1.0000
Resistance levels: 1.0220, 1.0284, 1.0365, 1.0415, 1.050

From the technical point of view, the trend on the EUR/USD currency pair on the hour time frame is bullish. The price is forming a wide balance, and the MACD indicator has become inactive, but the buyers’ pressure remains. Under such market conditions, it is best to look for buy trades on intraday time frames from the support level of 1.0181 or 1.0106, but only with confirmation. Sell trades can be considered from the resistance level of 1.0220 or 1.0284, but only after additional confirmation and with short targets.

Alternative scenario: if the price breaks down through the 1.0000 support level and fixes below, the downtrend will likely resume.

News feed for 2022.07.25:

– Eurozone German Ifo Business Climate (m/m) at 11:00 (GMT+3).

The GBP/USD currency pair

Technical indicators of the currency pair:

Prev Open: 1.1989
Prev Close: 1.2006
% chg. over the last day: -0.15%

Over the past month, the UK Manufacturing PMI has fallen from 52.8 to 52.2, while the service sector PMI has fallen from 54.3 to 53.3. This is weak data for the economy. The closer the index is to level 50, the closer the recession is. Statistically, if the PMI falls below 50, amid falling GDP, officials declare a recession. Volatile energy prices and a tight labor market have already caused Bank of England policymakers to oscillate between aggressively raising interest rates and the need to protect the economy from rising prices. With its open economy and huge current account deficit, the UK remains very vulnerable.

Trading recommendations

Support levels: 1.1964, 1.1907, 1.1803
Resistance levels: 1.2085, 1.2137

From the technical point of view, the trend on the GBP/USD currency pair on the hourly time frame is bullish. The price is trading at the level of the moving averages. The MACD indicator has become inactive. Under such market conditions, it is best to look for buy trades on intraday time frames from the support level of 1.1964 or 1.1907, but only with confirmation. Sell trades can be considered intraday from the resistance level of 1.2085, but only after additional confirmation and with short targets.

Alternative scenario: if the price breaks down through the 1.1803 support level and fixes below, the downtrend will likely resume.

There is no news feed for today.

The USD/JPY currency pair

Technical indicators of the currency pair:

Prev Open: 137.34
Prev Close: 136.06
% chg. over the last day: -0.94%

From the fundamental point of view, nothing has changed on the USD/JPY currency pair, as the Bank of Japan is still keeping its soft monetary policy. At the same time, the US Federal Reserve will raise the rate by another 0.75-1% this week and increase the difference between the US and Japanese rates even more. Even so, Japan’s yen has temporarily strengthened on the back of the dollar, which in turn declined at the end of last week due to the strengthening euro as the ECB raised the interest rate unexpectedly by 0.5%.

Trading recommendations

Support levels: 135.99, 135.40, 134.64, 134.11
Resistance levels: 136.60, 137.26, 137.81, 138.25, 138.56, 140.29

From the technical point of view, the medium-term trend on the USD/JPY currency pair has changed to bearish. The price has consolidated below the moving averages and broke through the priority change level. But it should be understood that this fall is not accompanied by any fundamental factors, so it is still necessary to be cautious when selling. Under such market conditions, buy trades can be searched for intraday from the support level of 135.99, but with additional confirmation. For sell deals, traders can consider the resistance level of 136.60 or 137.26, but only with additional confirmation and short targets.

Alternative scenario: If the price fixes above 138.25, the uptrend will likely resume.

There is no news feed for today.

The USD/CAD currency pair

Technical indicators of the currency pair:

Prev Open: 1.2865
Prev Close: 1.2914
% chg. over the last day: +0.38%

Canadian retail sales data for May increased by 1.6% on Friday, beating expectations of 1.2%. Retail sales excluding cars were also stronger than expected, +1.9% compared to the market forecast of 1.6% (m/m). But the Canadian dollar ended the day lower due to lower oil prices.

Trading recommendations

Support levels: 1.2862, 1.2781
Resistance levels: 1.2934, 1.3006, 1.3085, 1.3154

In terms of technical analysis, the trend on the USD/CAD currency pair is bearish. At the moment, the price is forming a balance and is trading at the levels of the moving lines. The MACD indicator has become inactive. Under such market conditions, it is best to consider sell deals from the resistance level of 1.2934, but with confirmation. Buy trades should be viewed on the lower time frames from the support level of 1.2862, but only with confirmation and short targets.

Alternative scenario: if the price breaks out and consolidates above the 1.3085 resistance level, the uptrend will likely resume.

There is no news feed for today.

By JustForex

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

Financial News Forex and Currency News

25 Jul

The Reserve Bank of Australia’s Comments Support AUD

By RoboForex Analytical Department

AUD/USD is balancing at 0.6083 on Monday. The bulls managed to break the descending channel and they stand a good chance of starting a new ascending tendency in the near future.

The RBA Governor is ready to tighten the regulator’s monetary policy by doubling the benchmark interest rate. The reason for this announcement is simple – it’s necessary to push inflation back to its target of 2-3%. Market players tend to respond to such comments, that’s why the AUD got significant support.

The quarterly CPI report is scheduled to be released as early as Wednesday and it is expected to show further growth in inflation, which has already reached its 20-year highs. Another important report, Retail Sales, will be published on Thursday and no positive dynamics are expected here as well. If this indicator is also far below expectations, the risks of a rate-hike by the RBA will increase, helping the AUD to continue its uptrend.

It should be noted that early in the year Philip Lowe wasn’t ready for monetary policy tightening and said that he couldn’t see the rate going up in 2022. However, high inflation forced the regulator to take emergency measures and start raising the rate.

As we can see in the H4 chart, after finishing the first descending impulse at 0.6876, AUD/USD is correcting upwards to reach 0.6925 and may later form another descending impulse towards 0.6886. Later, the market may break the latter level and continue trading within the downtrend with the target at 0.6850, or even extend this structure down to 0.6798. From the technical point of view, this scenario is confirmed by the MACD Oscillator: after leaving the histogram area, its signal line is about to fall and reach 0.

In the H1 chart, having completed the five-wave structure of the first descending impulse at 0.6875, AUD/USD is correcting upwards to reach 0.6925 and may later fall towards 0.6888, thus forming a new consolidation range between the two latter levels. After that, the instrument may break the range to the downside and form a new descending structure with the target at 0.6850. From the technical point of view, this scenario is confirmed by the Stochastic Oscillator: its signal line is moving above 80 and may soon start falling to break 50. Later, it may continue moving down to 20.

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

Financial News Forex and Currency News

25 Jul

Many important economic events will take place this week and volatility in the markets will be high

By JustForex

In the US, weekly jobless claims hit a five-month high, while existing home sales declined for the fifth straight month. These are signs of problems in the labor and housing markets. According to some analysts, the US Federal Reserve may officially announce the beginning of the recession in the United States this week. The US economy is already down 1.6% in the first quarter, and the second quarter is also negative, so, technically, this recession is possible.

At the close of the stock market on Friday, the Dow Jones index (US30) decreased by 0.43% (+1.34% for the week) and the S&P 500 Index (US500) fell by 0.93% (+2.00% for the week). The NASDAQ Technology Index (US100) lost 1.87% on Friday (+2.36% for the week).

It will be a significant week for US stock indices. Besides the important US Federal Reserve meeting on Wednesday and US GDP data on Thursday, technology giants like Amazon (AMZN), Apple (AAPL), Alphabet (GOOG), Meta (META), and Microsoft (MSFT) will report this week as well.

Stock markets in Europe were mostly up on Friday. German DAX (DE30) gained 0.05% (+2.46% for the week), French CAC 40 (FR 40) added 0.25% (+2.42% for the week), Spanish IBEX 35 (ES35) increased by 0.49% (+0.56% for the week), British FTSE 100 (UK100) gained 0.08% (+1.64% for the week).

Last week, the European Central Bank joined many other central banks in raising interest rates as its focus was on fighting inflation rather than a potential economic slowdown. On Friday, ECB chief Christine Lagarde said that the ECB would raise rates as much as needed to bring inflation back to target levels. By narrowing the interest rate differential, the euro has temporarily strengthened. But it should be noted that the US Federal Reserve will raise interest rates by 0.75-1% this week, which will widen the spread again.

US benchmark WTI crude has fallen nearly 3% in the past week, extending its losses over the past three weeks by almost 13%. However, Brent crude jumped by 2.2%, breaking a five-day losing streak of 17%. The situation in the oil market remains very unstable. On the one hand, the White House is trying to lower the price of oil. On the other hand, sanctions against Russia and supply shortage with high demand — these factors do not allow the price to fall.

Last week, precious metal prices rose. “Gold is starting to act as a haven as weakening economic growth will force many central banks to abandon their aggressive tightening plans,” said Ed Moya, head of research US analytical company.

Russia’s war with Ukraine continues. Last week, Russia, Ukraine, Turkey, and UN officials signed an agreement to allow Ukraine to ship grain from a port in Odesa. Despite this, Russian missiles struck the port on Saturday. Russia proved once again that it is a terrorist state. President Vladimir Zelensky, as well as many European officials, condemned Saturday’s attack as “barbarism,” which showed that Moscow could not be trusted under any circumstances.

Asian markets traded lower last week. Japan’s Nikkei 225 (JP225) gained 4.41%, Hong Kong’s Hang Seng (HK50) added 0.63%, and Australia’s S&P/ASX 200 (AU200) increased by 2.81%. At the opening on Monday, the Asian indices are showing a decline. Investors should also pay attention to Inflation Data in Singapore. Analysts forecast consumer price growth to 6.2% (current 5.6%) on an annualized basis. If the data is worse than expected, it may boost the Singapore dollar but at the same time have a negative impact on Asian indices.

In the commodities market, natural gas futures (+18.37%), palladium (+11.05%), platinum (+4.00%), coffee (+2.98%), cotton (+2.75%), copper (+2.74%) and Brent oil (+2.42%) showed the biggest gains over the week. Lumber futures (-10.06%), soybeans (-9.57%), sugar (-7.17%), corn (-6.95%) and wheat (-2.74%) showed the biggest drops.

S&P 500 (F) (US500) 3,961.63 −37.32 (−0.93%)

Dow Jones (US30) 31,899.29 −137.61 (−0.43%)

DAX (DE40) 13,253.68 +7.04 (+0.053%)

FTSE 100 (UK100) 7,276.37 +5.86 (+0.081%)

USD Index 106.55 −0.37 (−0.34%)

Important events for today:

– Singapore Consumer Price Index (m/m) at 08:00 (GMT+3);
– Eurozone German Ifo Business Climate (m/m) at 11:00 (GMT+3).

By JustForex

Economics & Fundamentals Financial News

25 Jul

Sri Lanka’s crisis: Can the South Asian economy break from the past and find a route to stability?

By Vidhura S Tennekoon, Indiana University

Sri Lanka has a new president and prime minister – but a change in who leads the crisis-hit South Asian nation alone will not solve the country’s severe economic problems.

Ranil Wickremesinghe – who on July 20, 2022, was voted in by lawmakers to replace fleeing former president Gotabaya Rajapaksa – and his appointed premier Dinesh Gunawardena inherit an economy grappling with record inflation as high as 59%, a currency that has lost almost half its value since March 2022 and severe shortages of daily necessities such as food and fuel. Nearly all economic activity in the country has ground to a halt.

The government’s deficit is so large it can’t afford to pay public workers, and the central bank has almost no foreign currency – needed to finance imports and pay back foreign debt.

In short, Sri Lanka is facing an unprecedented economic crisis, placing tremendous pressure on the new leaders to act fast to fix things.

As an economist and former official at the Central Bank of Sri Lanka, I believe the path forward will be difficult. The country will need to break with past policies and practices that put it in a financial hole while putting in place reforms to get the economy back on track. In particular, there are four key economic challenges the new government will have to address, though they’re all interconnected.

Addressing Sri Lankans’ immediate needs

To avoid the fate of his now exiled predecessor Gotabaya Rajapaksa, President Wickremesinghe will have to address the immediate needs of his people.

After being sworn in, Wickremesinghe said his priority was to ensure that people are able to eat three meals a day.

While food inflation has reached 76%, prices of many basic food items have increased by a higher margin – rice by 160%, wheat flour by 200% and sugar by 164%. To put that in context, a preschool teacher earning minimum wage would need more than a day’s wages to purchase a kilogram (2.2 pounds) of sugar and a kilogram of wheat flour or rice. A cylinder of cooking gas, if they were lucky to find one, would cost more than a half-month’s salary.

Cost of living ranks alongside other pressing issues. Reopening the shuttered schools and universities is another priority. The other urgent need is restoring transportation services. With no fuel to purchase, private bus services are in limbo and public transportation has become an adventure ride, with passengers dangling from the door and windows and even sitting inside the luggage box.

Restoring transportation and electricity services requires foreign currency to import fuel, but support from the International Monetary Fund, which provides financial help to struggling economies through loan packages, is months away. Unless the new president can persuade its regional powerhouses – India and China – to provide more help, economic hardships will continue and life in Sri Lanka will not be normal.

In the past, Sri Lanka has been able to rely on tourism to help bring revenue to the island nation. But this will be impossible while social unrest continues and shortages of essentials limit the country’s ability to serve visitors. Meanwhile, remittances from overseas Sri Lankans have also suffered because of a lack of confidence in the national currency, known as the rupee.

As Wickremesinghe has noted, things will get worse before they get better.

Balancing the budget

The next item on the president’s to-do list will likely be finding a way to bring the budget deficit down. Last year, expenses were 240% of revenue, and 91% more was needed to repay debt. Money printing covered a large portion of this gap but only exacerbated inflation.

The primary reason for Sri Lanka’s current crisis is decades of fiscal mismanagement, with too much spending and too little revenue.

Fixing this problem will require a combination of higher taxes and significant budget cuts. But the budget gap is too wide to eliminate completely the need for money printing. The best that can be hoped for is an aggressive reduction.

Restructuring Sri Lanka’s huge debt

Such budgetary reforms will likely be necessary to solve another challenge Sri Lanka faces: overseas debt.

Sri Lanka has amassed about US$51 billion in foreign debt over the past decades but has virtually no foreign currency with which to pay it back. The government suspended payments on foreign debt in April, sending it into default.

At the end of 2021, about 45% of the debt was owed to private investors, while the rest belonged to countries and multinational institutions. The Asian Development Bank owned the biggest share, at 16%, while Japan, China and the World Bank held 10% apiece.

For Sri Lanka to emerge from its crisis, it will need significant help from the IMF. But the IMF requires assurances that Sri Lanka’s debt sustainability be restored before lending it money.

And other international organizations, such as the World Bank, will not be willing to lend Sri Lanka more until the country signs an agreement with the IMF. And U.S. lawmakers have recently suggested IMF support will be contingent on Sri Lanka’s increasing the independence of its central bank, fighting corruption and doing more to promote the rule of law.

While G-7 countries, the group of leading economies, including Japan, appear willing to help Sri Lanka in its effort to restructure its debt, some bondholders – such as Caribbean-based Hamilton Reserve Bank, which holds just $250 million worth – have already taken legal action to claim their dues.

In May, Sri Lanka took a first step toward restructuring its debt, but it may take several months before the country is able to successfully negotiate with its creditors to ensure debt sustainability.

Garnering public support for reforms

Wickremesinghe’s biggest and most unenviable challenge, however, is less about the economy and more about the politics of fixing it.

He won’t be able to do much about Sri Lanka’s economy until he’s able to bring about political stability. And right now, Sri Lanka remains in turmoil.

Wickremesinghe, who previously served as prime minister appointed by his toppled predecessor, will need a wide mandate and support from opposition politicians if he is to drastically change Sri Lanka’s policies. Upon election, he immediately urged his rivals to join him and “work together to bring the country out of the crisis,” adding, “Our divisions are now over.”

He will also need to address protesters’ demands over reducing executive powers while bringing in strong anti-corruption measures and strengthening democratic institutions.

Yet many doubt Wickremesinghe’s ability to unite Sri Lanka and question his mandate to serve out the remaining term of the presidency. He has been a target of protesters since being appointed president. And a confrontation between armed forces and protesters soon after Wickremesinghe took power doesn’t bode well.

Turning around an economy so deep in crisis will take time. Inflation in Sri Lanka is not believed to have peaked yet, and people will continue to face economic hardships for some time.

But political stability will be needed before Sri Lanka can get out of its economic mess. The fiscal reforms expected by the IMF will be painful and will be viable only with public support, and that of all major political parties in Sri Lanka’s Parliament.

About the Author:

Vidhura S Tennekoon, Assistant Professor of Economics, Indiana University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Economics & Fundamentals Financial News

25 Jul

Europe On Sale: Get It While U Can

By Elliott Wave International

On July 13 and 14, the euro and the U.S. dollar briefly traded at parity — for the first time in 20 years.

Just 19 months ago, EURUSD was at $1.2350. It’s quietly dropped 20%+ since.

Quietly? Yeah, because of all the other fireworks in the market drowned out the news.

What would you have done with this knowledge a year and a half ago?

For one thing, you’d have put off that European vacation until now!

Who could have known? EWI subscribers. Check out this forecast from EWI back on January 8, 2021:

It appears that currencies are delivering the early New Year trend reversal that often occurs. The [Euro]’s high at 1.2350 on Wednesday, January 6, completes the five-wave rally from at least November 4, 2020 (1.1604) and likely from March 23, 2020 (1.0635)…Greater bearish potential exists…

Every student of Elliott knows that when five waves finish, you should anticipate a reversal of equal degree.

Here’s what happened since:

Mmmm, I love a good chart.

And a great tweet. Tip of the hat to Mr_Cuddlez!

So, are you ready to catch the next big euro move?

EWI’s Chief Market Analyst Steven Hochberg guides our Financial Forecast Service subscribers 3X/week through the twist and turns in the euro (and dollar) — plus, U.S. stock indexes, bonds, gold and silver — inside his Short Term Update.

Right now, read our forecasts for all of the markets listed above (and more) inside our Financial Forecast Service Test Drive — just $17 for a full week’s access.

Join the Financial Forecast Service Test Drive now.

Hurry: Your one-time Test Drive opportunity ends Thursday, July 28th.

This article was syndicated by Elliott Wave International and was originally published under the headline Europe On Sale: Get It While U Can. EWI is the world’s largest market forecasting firm. Its staff of full-time analysts led by Chartered Market Technician Robert Prechter provides 24-hour-a-day market analysis to institutional and private investors around the world.

Financial News Forex and Currency News

23 Jul

COT Week 29 Charts: Bonds Speculators bets mixed led by Eurodollar, 5-Year & Long Treasury Bond

Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday July 19th and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets.

Weekly Speculator Changes

COT bond market speculator bets were mixed evenly this week as four out of the eight bond markets we cover had higher positioning this week while the other four markets had lower speculator contracts.

Leading the weekly gains for the bond markets was the Eurodollar (80,661 contracts) with the 5-Year Bond (33,108 contracts), the Fed Funds Futures (32,523 contracts) and the 2-Year Bond (1,516 contracts) also showing positive changes for the week.

The bond markets leading the declines in speculator bets this week were the Long US Bond (-18,884 contracts) with the Ultra US Bond (-17,487 contracts) coming in a close second while the Ultra 10-Year (-8,368 contracts) and the 10-Year Bond (-333 contracts) also saw lower speculator bets on the week.

Data Snapshot of Bond Market Traders | Columns Legend

Jul-19-2022	OI	OI-Index	Spec-Net	Spec-Index	Com-Net	COM-Index	Smalls-Net	Smalls-Index
Eurodollar	9,390,825	11	-2,643,905	4	2,937,912	94	-294,007	40
FedFunds	1,769,139	59	113,578	54	-105,032	47	-8,546	38
2-Year	2,079,265	13	-63,053	70	141,849	51	-78,796	16
Long T-Bond	1,182,312	44	-42,102	71	23,004	19	19,098	68
10-Year	3,431,246	25	-108,704	56	172,612	42	-63,908	64
5-Year	3,916,097	47	-258,015	38	400,930	62	-142,915	42

Strength Scores

Strength Scores (a normalized measure of Speculator positions over a 3-Year range, from 0 to 100 where above 80 is extreme bullish and below 20 is extreme bearish) show that the US Treasury Bond (70.9 percent) continues to lead the bonds category in sentiment. The 2-Year Bond (69.5 percent) comes in as the next highest bonds market in strength scores followed by the 10-Year Bond (55.9 percent) and the Fed Funds (53.6 percent). On the downside, the Eurodollar (4.3 percent) and the Ultra 10-Year Bond (19.5 percent) come in at the lowest strength levels currently and are both in bearish extreme standings this week (below 20 percent). The next lowest strength scores are seen in the 5-Year Bond (37.9 percent) and the Ultra US Treasury Bond (44.1 percent).

Strength Statistics:
Fed Funds (53.6 percent) vs Fed Funds previous week (49.6 percent)
2-Year Bond (69.5 percent) vs 2-Year Bond previous week (69.2 percent)
5-Year Bond (37.9 percent) vs 5-Year Bond previous week (32.1 percent)
10-Year Bond (55.9 percent) vs 10-Year Bond previous week (56.0 percent)
Ultra 10-Year Bond (19.5 percent) vs Ultra 10-Year Bond previous week (21.7 percent)
US Treasury Bond (70.9 percent) vs US Treasury Bond previous week (77.0 percent)
Ultra US Treasury Bond (44.1 percent) vs Ultra US Treasury Bond previous week (51.3 percent)
Eurodollar (4.3 percent) vs Eurodollar previous week (2.8 percent)

Strength Trends

Strength Score Trends (or move index, calculates the 6-week changes in strength scores) show that the 10-Year Bond (23.9 percent) leads the past six weeks trends for bonds currently. The 2-Year Bond (21.7 percent), the Ultra 10-Year Bond (10.4 percent) and the Fed Funds (7.3 percent) fill out the rest of the positive movers in the latest trends data. The US Treasury Bond (-15.3 percent) leads the downside trend scores currently while the next markets with negative trend scores were the Ultra US Treasury Bond (-12.6 percent) and the 5-Year Bond (-6.2 percent).

Strength Trend Statistics:
Fed Funds (7.3 percent) vs Fed Funds previous week (6.9 percent)
2-Year Bond (21.7 percent) vs 2-Year Bond previous week (12.8 percent)
5-Year Bond (-6.2 percent) vs 5-Year Bond previous week (-12.9 percent)
10-Year Bond (23.9 percent) vs 10-Year Bond previous week (19.8 percent)
Ultra 10-Year Bond (10.4 percent) vs Ultra 10-Year Bond previous week (20.3 percent)
US Treasury Bond (-15.3 percent) vs US Treasury Bond previous week (-14.0 percent)
Ultra US Treasury Bond (-12.6 percent) vs Ultra US Treasury Bond previous week (-7.8 percent)
Eurodollar (0.0 percent) vs Eurodollar (2.4 percent)

3-Month Eurodollars Futures:

The 3-Month Eurodollars large speculator standing this week resulted in a net position of -2,643,905 contracts in the data reported through Tuesday. This was a weekly lift of 80,661 contracts from the previous week which had a total of -2,724,566 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 4.3 percent. The commercials are Bullish-Extreme with a score of 93.5 percent and the small traders (not shown in chart) are Bearish with a score of 39.7 percent.

3-Month Eurodollars Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	4.9	71.7	4.4
– Percent of Open Interest Shorts:	33.0	40.4	7.5
– Net Position:	-2,643,905	2,937,912	-294,007
– Gross Longs:	455,567	6,735,605	413,100
– Gross Shorts:	3,099,472	3,797,693	707,107
– Long to Short Ratio:	0.1 to 1	1.8 to 1	0.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	4.3	93.5	39.7
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	0.0	-1.5	18.3

Individual Markets:

30-Day Federal Funds Futures:

The 30-Day Federal Funds large speculator standing this week resulted in a net position of 113,578 contracts in the data reported through Tuesday. This was a weekly lift of 32,523 contracts from the previous week which had a total of 81,055 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 53.6 percent. The commercials are Bearish with a score of 47.1 percent and the small traders (not shown in chart) are Bearish with a score of 38.0 percent.

30-Day Federal Funds Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	14.0	72.9	1.8
– Percent of Open Interest Shorts:	7.6	78.9	2.3
– Net Position:	113,578	-105,032	-8,546
– Gross Longs:	248,072	1,290,344	31,928
– Gross Shorts:	134,494	1,395,376	40,474
– Long to Short Ratio:	1.8 to 1	0.9 to 1	0.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	53.6	47.1	38.0
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	7.3	-6.9	-5.7

2-Year Treasury Note Futures:

The 2-Year Treasury Note large speculator standing this week resulted in a net position of -63,053 contracts in the data reported through Tuesday. This was a weekly increase of 1,516 contracts from the previous week which had a total of -64,569 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 69.5 percent. The commercials are Bullish with a score of 50.9 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 15.7 percent.

2-Year Treasury Note Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	13.4	78.1	6.6
– Percent of Open Interest Shorts:	16.5	71.3	10.4
– Net Position:	-63,053	141,849	-78,796
– Gross Longs:	279,480	1,623,897	137,606
– Gross Shorts:	342,533	1,482,048	216,402
– Long to Short Ratio:	0.8 to 1	1.1 to 1	0.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	69.5	50.9	15.7
– Strength Index Reading (3 Year Range):	Bullish	Bullish	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	21.7	-18.2	-10.1

5-Year Treasury Note Futures:

The 5-Year Treasury Note large speculator standing this week resulted in a net position of -258,015 contracts in the data reported through Tuesday. This was a weekly increase of 33,108 contracts from the previous week which had a total of -291,123 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 37.9 percent. The commercials are Bullish with a score of 62.2 percent and the small traders (not shown in chart) are Bearish with a score of 41.7 percent.

5-Year Treasury Note Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	7.3	84.3	7.4
– Percent of Open Interest Shorts:	13.9	74.1	11.0
– Net Position:	-258,015	400,930	-142,915
– Gross Longs:	284,416	3,302,273	289,136
– Gross Shorts:	542,431	2,901,343	432,051
– Long to Short Ratio:	0.5 to 1	1.1 to 1	0.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	37.9	62.2	41.7
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-6.2	-1.0	12.0

10-Year Treasury Note Futures:

The 10-Year Treasury Note large speculator standing this week resulted in a net position of -108,704 contracts in the data reported through Tuesday. This was a weekly lowering of -333 contracts from the previous week which had a total of -108,371 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 55.9 percent. The commercials are Bearish with a score of 42.4 percent and the small traders (not shown in chart) are Bullish with a score of 64.3 percent.

10-Year Treasury Note Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	10.2	77.4	9.8
– Percent of Open Interest Shorts:	13.4	72.4	11.6
– Net Position:	-108,704	172,612	-63,908
– Gross Longs:	351,679	2,655,676	335,131
– Gross Shorts:	460,383	2,483,064	399,039
– Long to Short Ratio:	0.8 to 1	1.1 to 1	0.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	55.9	42.4	64.3
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	23.9	-30.2	22.6

Ultra 10-Year Notes Futures:

The Ultra 10-Year Notes large speculator standing this week resulted in a net position of -35,707 contracts in the data reported through Tuesday. This was a weekly fall of -8,368 contracts from the previous week which had a total of -27,339 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 19.5 percent. The commercials are Bullish with a score of 78.6 percent and the small traders (not shown in chart) are Bullish with a score of 51.1 percent.

Ultra 10-Year Notes Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	5.2	82.8	11.6
– Percent of Open Interest Shorts:	8.2	70.1	21.2
– Net Position:	-35,707	149,258	-113,551
– Gross Longs:	61,232	974,246	136,055
– Gross Shorts:	96,939	824,988	249,606
– Long to Short Ratio:	0.6 to 1	1.2 to 1	0.5 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	19.5	78.6	51.1
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	10.4	-9.7	-1.5

US Treasury Bonds Futures:

The US Treasury Bonds large speculator standing this week resulted in a net position of -42,102 contracts in the data reported through Tuesday. This was a weekly decline of -18,884 contracts from the previous week which had a total of -23,218 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 70.9 percent. The commercials are Bearish-Extreme with a score of 18.8 percent and the small traders (not shown in chart) are Bullish with a score of 67.7 percent.

US Treasury Bonds Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	7.6	77.9	13.9
– Percent of Open Interest Shorts:	11.2	75.9	12.3
– Net Position:	-42,102	23,004	19,098
– Gross Longs:	90,183	920,782	164,348
– Gross Shorts:	132,285	897,778	145,250
– Long to Short Ratio:	0.7 to 1	1.0 to 1	1.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	70.9	18.8	67.7
– Strength Index Reading (3 Year Range):	Bullish	Bearish-Extreme	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-15.3	10.2	14.6

Ultra US Treasury Bonds Futures:

The Ultra US Treasury Bonds large speculator standing this week resulted in a net position of -345,782 contracts in the data reported through Tuesday. This was a weekly fall of -17,487 contracts from the previous week which had a total of -328,295 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 44.1 percent. The commercials are Bullish with a score of 65.5 percent and the small traders (not shown in chart) are Bullish with a score of 55.6 percent.

Ultra US Treasury Bonds Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	3.8	84.8	11.3
– Percent of Open Interest Shorts:	30.1	61.4	8.4
– Net Position:	-345,782	307,679	38,103
– Gross Longs:	49,387	1,113,613	147,987
– Gross Shorts:	395,169	805,934	109,884
– Long to Short Ratio:	0.1 to 1	1.4 to 1	1.3 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	44.1	65.5	55.6
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-12.6	8.3	10.0

Article By InvestMacro – Receive our weekly COT Reports by Email

*COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets.

The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators) as well as their open interest (contracts open in the market at time of reporting).See CFTC criteria here.

Bonds CountingPips Forex Blog Financial News investing

23 Jul

COT Week 29 Charts: Soft Commodities Speculator bets slightly higher led by Sugar & Lean Hogs

Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday July 19th and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets.

Weekly Speculator Changes

COT soft commodities speculator bets were mostly higher this week as six out of the eleven soft commodities markets we cover had higher positioning this week while the other five markets had lower contracts.

Leading the weekly gains for soft commodities markets was Sugar (21,293 contracts) with Lean Hogs (4,560 contracts), Cocoa (3,578 contracts), Wheat (1,883 contracts), Soybean Meal (277 contracts) and Live Cattle (57 contracts) also showing higher speculator bets on the week.

The softs markets leading the declines in speculator bets this week were Corn (-37,216 contracts) and Soybeans (-12,526 contracts) with Coffee (-6,329 contracts), Cotton (-4,934 contracts) and Soybean Oil (-2,463 contracts) also registering lower bets on the week.

Data Snapshot of Commodity Market Traders | Columns Legend

Jul-19-2022	OI	OI-Index	Spec-Net	Spec-Index	Com-Net	COM-Index	Smalls-Net	Smalls-Index
WTI Crude	1,577,616	0	271,091	1	-293,689	100	22,598	47
Gold	524,786	21	94,955	0	-112,262	100	17,307	0
Silver	145,247	12	1,360	0	-8,213	100	6,853	2
Copper	174,592	8	-23,836	25	23,745	76	91	26
Palladium	6,915	3	-3,751	2	4,302	99	-551	12
Platinum	75,069	47	-4,282	2	-273	98	4,555	26
Natural Gas	953,325	0	-120,323	42	86,699	58	33,624	60
Brent	177,889	22	-41,302	42	40,843	61	459	15
Heating Oil	267,576	22	9,243	56	-23,800	46	14,557	49
Soybeans	602,987	0	102,593	45	-74,427	61	-28,166	23
Corn	1,308,458	0	209,940	57	-165,611	48	-44,329	18
Coffee	196,041	3	27,979	63	-28,026	44	47	0
Sugar	703,614	0	127,162	63	-141,842	41	14,680	26
Wheat	292,700	2	6,522	28	3,173	64	-9,695	60

Strength Scores

Strength Scores (a normalized measure of Speculator positions over a 3-Year range, from 0 to 100 where above 80 is extreme bullish and below 20 is extreme bearish) show that Soybean Meal (83.5 percent) leads the softs in scores and is currently in a bullish extreme state (above 80 percent). Coffee (63.0 percent) and Sugar (62.8 percent) round out the other soft commodity markets at the top of the strength list while Corn (56.8 percent) comes in next but has been falling steadily in the speculator sentiment for several weeks. On the downside, Live Cattle (6.9 percent) is the weakest in strength scores followed by Cocoa (17.0 percent) and both of these markets are in a bearish extreme level (below 20 percent). Soybean Oil (24.1 percent) and Wheat (27.5 percent) are the next two lowest in scoring.

Strength Statistics:
Corn (56.8 percent) vs Corn previous week (61.6 percent)
Sugar (62.8 percent) vs Sugar previous week (58.4 percent)
Coffee (63.0 percent) vs Coffee previous week (68.5 percent)
Soybeans (45.4 percent) vs Soybeans previous week (49.2 percent)
Soybean Oil (24.1 percent) vs Soybean Oil previous week (25.7 percent)
Soybean Meal (83.5 percent) vs Soybean Meal previous week (83.4 percent)
Live Cattle (6.9 percent) vs Live Cattle previous week (6.8 percent)
Lean Hogs (39.0 percent) vs Lean Hogs previous week (34.0 percent)
Cotton (46.7 percent) vs Cotton previous week (49.8 percent)
Cocoa (17.0 percent) vs Cocoa previous week (13.5 percent)
Wheat (27.5 percent) vs Wheat previous week (25.1 percent)

Strength Trends

Strength Score Trends (or move index, calculates the 6-week changes in strength scores) show that Lean Hogs (20.8 percent) is the far and away leader in the past six weeks trends for soft commodity markets. Soybean Meal (6.1 percent) is the only other positive mover in the latest trends data and reiterates the weakness of the overall softs markets currently. On the downside, Soybean Oil (-34.2 percent) leads the negative trend scores while the next markets with lower trend scores were Corn (-23.2 percent), Soybeans (-22.5 percent), Wheat (-22.6 percent) and Cotton (-21.0 percent).

Strength Trend Statistics:
Corn (-23.2 percent) vs Corn previous week (-20.1 percent)
Sugar (-14.0 percent) vs Sugar previous week (-19.7 percent)
Coffee (-18.0 percent) vs Coffee previous week (-7.5 percent)
Soybeans (-22.5 percent) vs Soybeans previous week (-21.6 percent)
Soybean Oil (-34.2 percent) vs Soybean Oil previous week (-30.2 percent)
Soybean Meal (6.1 percent) vs Soybean Meal previous week (10.9 percent)
Live Cattle (-4.4 percent) vs Live Cattle previous week (3.0 percent)
Lean Hogs (20.8 percent) vs Lean Hogs previous week (17.3 percent)
Cotton (-21.0 percent) vs Cotton previous week (-17.9 percent)
Cocoa (-14.8 percent) vs Cocoa previous week (-14.0 percent)
Wheat (-22.6 percent) vs Wheat previous week (-23.0 percent)

Individual Markets:

CORN Futures:

The CORN large speculator standing this week recorded a net position of 209,940 contracts in the data reported through Tuesday. This was a weekly decrease of -37,216 contracts from the previous week which had a total of 247,156 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 56.8 percent. The commercials are Bearish with a score of 48.3 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 17.5 percent.

CORN Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	27.4	48.2	9.8
– Percent of Open Interest Shorts:	11.4	60.9	13.2
– Net Position:	209,940	-165,611	-44,329
– Gross Longs:	358,478	631,146	127,850
– Gross Shorts:	148,538	796,757	172,179
– Long to Short Ratio:	2.4 to 1	0.8 to 1	0.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	56.8	48.3	17.5
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-23.2	24.4	5.6

SUGAR Futures:

The SUGAR large speculator standing this week recorded a net position of 127,162 contracts in the data reported through Tuesday. This was a weekly gain of 21,293 contracts from the previous week which had a total of 105,869 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 62.8 percent. The commercials are Bearish with a score of 41.3 percent and the small traders (not shown in chart) are Bearish with a score of 26.0 percent.

SUGAR Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	27.3	50.2	9.5
– Percent of Open Interest Shorts:	9.2	70.4	7.4
– Net Position:	127,162	-141,842	14,680
– Gross Longs:	192,030	353,385	66,497
– Gross Shorts:	64,868	495,227	51,817
– Long to Short Ratio:	3.0 to 1	0.7 to 1	1.3 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	62.8	41.3	26.0
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-14.0	17.6	-30.2

COFFEE Futures:

The COFFEE large speculator standing this week recorded a net position of 27,979 contracts in the data reported through Tuesday. This was a weekly decrease of -6,329 contracts from the previous week which had a total of 34,308 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 63.0 percent. The commercials are Bearish with a score of 43.8 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 0.0 percent.

COFFEE Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	24.0	53.4	3.9
– Percent of Open Interest Shorts:	9.7	67.7	3.8
– Net Position:	27,979	-28,026	47
– Gross Longs:	47,036	104,664	7,570
– Gross Shorts:	19,057	132,690	7,523
– Long to Short Ratio:	2.5 to 1	0.8 to 1	1.0 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	63.0	43.8	0.0
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-18.0	21.2	-23.3

SOYBEANS Futures:

The SOYBEANS large speculator standing this week recorded a net position of 102,593 contracts in the data reported through Tuesday. This was a weekly decline of -12,526 contracts from the previous week which had a total of 115,119 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 45.4 percent. The commercials are Bullish with a score of 61.3 percent and the small traders (not shown in chart) are Bearish with a score of 23.4 percent.

SOYBEANS Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	26.4	52.7	6.6
– Percent of Open Interest Shorts:	9.4	65.0	11.2
– Net Position:	102,593	-74,427	-28,166
– Gross Longs:	159,262	317,597	39,543
– Gross Shorts:	56,669	392,024	67,709
– Long to Short Ratio:	2.8 to 1	0.8 to 1	0.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	45.4	61.3	23.4
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-22.5	22.1	0.1

SOYBEAN OIL Futures:

The SOYBEAN OIL large speculator standing this week recorded a net position of 27,325 contracts in the data reported through Tuesday. This was a weekly fall of -2,463 contracts from the previous week which had a total of 29,788 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 24.1 percent. The commercials are Bullish with a score of 78.2 percent and the small traders (not shown in chart) are Bearish with a score of 25.1 percent.

SOYBEAN OIL Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	17.7	60.1	7.1
– Percent of Open Interest Shorts:	10.4	68.2	6.3
– Net Position:	27,325	-30,449	3,124
– Gross Longs:	66,220	225,283	26,605
– Gross Shorts:	38,895	255,732	23,481
– Long to Short Ratio:	1.7 to 1	0.9 to 1	1.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	24.1	78.2	25.1
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-34.2	39.3	-50.3

SOYBEAN MEAL Futures:

The SOYBEAN MEAL large speculator standing this week recorded a net position of 100,674 contracts in the data reported through Tuesday. This was a weekly rise of 277 contracts from the previous week which had a total of 100,397 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 83.5 percent. The commercials are Bearish with a score of 20.4 percent and the small traders (not shown in chart) are Bearish with a score of 34.7 percent.

SOYBEAN MEAL Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	28.3	42.1	10.9
– Percent of Open Interest Shorts:	3.1	72.1	6.0
– Net Position:	100,674	-120,304	19,630
– Gross Longs:	113,190	168,512	43,743
– Gross Shorts:	12,516	288,816	24,113
– Long to Short Ratio:	9.0 to 1	0.6 to 1	1.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	83.5	20.4	34.7
– Strength Index Reading (3 Year Range):	Bullish-Extreme	Bearish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	6.1	-2.6	-30.7

LIVE CATTLE Futures:

The LIVE CATTLE large speculator standing this week recorded a net position of 21,956 contracts in the data reported through Tuesday. This was a weekly lift of 57 contracts from the previous week which had a total of 21,899 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 6.9 percent. The commercials are Bullish-Extreme with a score of 82.5 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 83.8 percent.

LIVE CATTLE Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	33.1	41.8	12.0
– Percent of Open Interest Shorts:	24.8	50.4	11.8
– Net Position:	21,956	-22,536	580
– Gross Longs:	87,558	110,738	31,759
– Gross Shorts:	65,602	133,274	31,179
– Long to Short Ratio:	1.3 to 1	0.8 to 1	1.0 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	6.9	82.5	83.8
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-4.4	2.3	6.2

LEAN HOGS Futures:

The LEAN HOGS large speculator standing this week recorded a net position of 29,619 contracts in the data reported through Tuesday. This was a weekly advance of 4,560 contracts from the previous week which had a total of 25,059 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 39.0 percent. The commercials are Bullish with a score of 67.8 percent and the small traders (not shown in chart) are Bullish with a score of 55.3 percent.

LEAN HOGS Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	35.7	37.7	10.6
– Percent of Open Interest Shorts:	20.9	48.5	14.5
– Net Position:	29,619	-21,680	-7,939
– Gross Longs:	71,395	75,386	21,122
– Gross Shorts:	41,776	97,066	29,061
– Long to Short Ratio:	1.7 to 1	0.8 to 1	0.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	39.0	67.8	55.3
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	20.8	-22.0	-2.8

COTTON Futures:

The COTTON large speculator standing this week recorded a net position of 37,751 contracts in the data reported through Tuesday. This was a weekly decline of -4,934 contracts from the previous week which had a total of 42,685 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 46.7 percent. The commercials are Bullish with a score of 54.3 percent and the small traders (not shown in chart) are Bearish with a score of 30.3 percent.

COTTON Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	37.2	44.9	6.3
– Percent of Open Interest Shorts:	16.1	67.6	4.7
– Net Position:	37,751	-40,631	2,880
– Gross Longs:	66,520	80,429	11,313
– Gross Shorts:	28,769	121,060	8,433
– Long to Short Ratio:	2.3 to 1	0.7 to 1	1.3 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	46.7	54.3	30.3
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-21.0	23.3	-43.1

COCOA Futures:

The COCOA large speculator standing this week recorded a net position of -602 contracts in the data reported through Tuesday. This was a weekly increase of 3,578 contracts from the previous week which had a total of -4,180 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 17.0 percent. The commercials are Bullish-Extreme with a score of 84.9 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 12.8 percent.

COCOA Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	30.4	45.4	4.2
– Percent of Open Interest Shorts:	30.6	45.7	3.7
– Net Position:	-602	-1,028	1,630
– Gross Longs:	94,072	140,649	13,132
– Gross Shorts:	94,674	141,677	11,502
– Long to Short Ratio:	1.0 to 1	1.0 to 1	1.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	17.0	84.9	12.8
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-14.8	16.3	-17.0

WHEAT Futures:

The WHEAT large speculator standing this week recorded a net position of 6,522 contracts in the data reported through Tuesday. This was a weekly advance of 1,883 contracts from the previous week which had a total of 4,639 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 27.5 percent. The commercials are Bullish with a score of 64.2 percent and the small traders (not shown in chart) are Bullish with a score of 60.1 percent.

WHEAT Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	31.3	40.5	9.4
– Percent of Open Interest Shorts:	29.1	39.4	12.7
– Net Position:	6,522	3,173	-9,695
– Gross Longs:	91,557	118,634	27,569
– Gross Shorts:	85,035	115,461	37,264
– Long to Short Ratio:	1.1 to 1	1.0 to 1	0.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	27.5	64.2	60.1
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-22.6	32.8	-29.5

Article By InvestMacro – Receive our weekly COT Reports by Email

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