Archive for Forex and Currency News – Page 59

25 Sep

Trade Of The Week: Is the USDJPY a ticking timebomb?

By ForexTime 

The USDJPY has kicked off the new trading week by touching its highest level since November 2022.

Yen bears are clearly in power, with the Japanese yen currently the worst performing G10 currency year-to-date, shedding roughly 11.8% against the dollar.

Last Friday, the Bank of Japan (BoJ) left its ultra-loose monetary policy unchanged and kept its dovish stance despite high inflation. While the policy divergence between the Fed and BoJ remains a key driving force behind the USDJPY’s upside, the threat of government intervention could frighten bulls down the road.

Taking a trip down memory lane, the BoJ intervened back in September 2022 when the yen weakened to 145.90. Two more interventions followed in October after the Yen fell below 150.

Given how the currency is weaker than last year when Japan acted, investors remain on high alert with much chatter around 150 acting as a key level that could trigger government intervention.

It is worth keeping in mind that a weakening Yen results in higher import prices. This is transferred to producers, boosting expectations for higher inflation with consumers feeling the pain. Such a development could be a headache for policymakers, especially when factoring in how Japan’s headline and core inflation remain above the BOJ’s 2% target.

With all the above said, the threat of government intervention has made the USDJPY a ticking timebomb that could explode at any moment…

Here are 3 factors that could impact the currency pair this week:

  1. Fed speeches + US August PCE report

A host of Fed officials, including Fed Chair Jerome Powell will be under the spotlight this week.

Last week’s FOMC meeting concluded with Powell indicating that rates will remain “higher for longer”. Should policymakers strike a hawkish tone and reinforce last week’s messaging, the USDJPY could push higher as expectations rise around the Fed hiking rates once more hike in 2023.

Regarding the August PCE report, markets expect the August PCE report to show headline prices accelerated 0.5% month-over-month after July’s 0.2% increase while the core PCE deflator is forecast to rise 0.2%, same as July. The core personal consumption expenditures price index for projected to rise 3.9% year-over-year in August, down from the 4.2% seen in July.

Ultimately, more signs of cooling inflationary pressures may counteract the argument around the Fed “keeping rates higher for longer”, weakening the USDJPY as a result.

  1. Japan data dump

Investors will be dished out some key economic reports from Japan on Friday.

All eyes will be on the Tokyo inflation data for September, jobless rate, industrial production, and retail sales figures for August which could provide insight into the health of Japan’s economy.

  • Should the overall economic data from Japan print above market expectations, this may boost sentiment towards the Japanese economy – pulling the USDJPY lower as the yen strengthens.
  • If overall economic data disappoints, sentiment toward the Japanese economy could take a hit – pushing the USDJPY higher as the yen weakens.

  1. Technical forces

The USDJPY is firmly bullish on the daily timeframe as there have been consistently higher highs and higher lows. However, prices are slowly approaching overbought conditions while bulls displaying slight hesitation due to key fundamental forces.

  • The current upside could take prices towards the 150.00 psychological level. Beyond this point, the next key level of interest is the 2022 high at 151.94.
  • Should bulls get cold amid intervention fears, prices could slip back below 147.50, 146.70, and 144.90, respectively.

Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Forex and Currency News Opinions
22 Sep

Week Ahead: Will EURUSD hit new 6-month low?

By ForexTime 

  • Final week of Q3 2023 may prove relatively less hectic for markets
  • EURUSD still set to uncover trading opportunities
  • Eurozone data may point to even-darker economic outlook
  • US dollar could be boosted by PCE Deflators, hawkish Fed speak
  • Bloomberg model: 74% chance EURUSD trades within 1.0542 – 1.0770

 

Managed to catch your breath yet after such a hectic week in the markets?

At least the coming ahead may prove to be less eventful in comparison, providing a relative breather before we enter the final quarter of 2023.

 

Still, EURUSD traders are bound to discover fresh trading opportunities in the week ahead.

Key data releases from either side of the Atlantic should move the world’s most-traded FX pair.

 

But first, here’s a quick list of major events and data releases due in the final week of September:

Monday, September 25

  • EUR: Germany IFO business climate (Sept)
  • USD: Speech by Minneapolis Fed President Neel Kashkari

Tuesday, September 26

  • EUR: Speeches by ECB’s Robert Holzmann, Philip Lane
  • USD: US consumer confidence (Sept)

Wednesday, September 27

  • JPY: Bank of Japan meeting minutes
  • CNH: China industrial profits (Aug)
  • EUR: Germany consumer confidence (Oct)

Thursday, September 28

  • AUD: Australia retail sales (Aug)
  • EUR: Germany CPI (Sept); Eurozone economic and consumer confidence (Sept)
  • USD: US weekly initial jobless claims; 3Q GDP (3rd estimate)
  • USD: Speeches by Fed Chair Jerome Powell, Richmond Fed President Tom Barkin; Chicago Fed President Austan Goolsbee
  • Nike quarterly earnings

Friday, September 29

  • JPY: Tokyo CPI (Sept); jobless rate, industrial production, and retail sales (Aug)
  • GBP: UK 2Q GDP (final)
  • EUR: Eurozone CPI (Sept); Germany unemployment (Sept)
  • USD: US PCE deflator, consumer spending (Aug); speech by New York Fed President John Williams

 

Data to show still-gloomy Eurozone economy?

Markets have of late been growing more concerned about the Eurozone’s economic prospects.

After all, Germany, the largest economy in the bloc, is widely expected to see its economy shrink for 2023.

And that’s according to economists, the OECD, and even the Bundesbank – Germany’s own central bank.

Amid such a darkening economic outlook, comes also the fact that the Eurozone’s consumer price index (CPI) – which measures headline inflation – remains more than twice the European Central Bank’s 2% target.

The above combo (economic woes + stick inflation) is set to bind the hands of ECB hawks (policymakers who want to send interest rates higher) from triggering yet another rate hike.

At the time of writing, markets are pricing in a mere 24% chance that the ECB can trigger one final 25-basis point hike by January 2024.

To oversimplify …

Greater economic woes = ECB unable to hike, despite sticky inflation = lower EURUSD

 

 

Then, on the USD side of the equation …

Fed speak, US data to offer clues on last Fed rate hike

Several Fed officials, including Fed Chair Jerome Powell, are due to make public speeches in the week ahead.

Such commentary comes hot on the heels after this week’s FOMC meeting (Sept 19-20th), which concluded with Chair Powell pressing home the “higher-for-longer” message.

That is to say, the US central bank is expecting to:

  • hike by another 25-basis points before end-2023 (markets are predicting a 53% chance for one more Fed rate hike by December)
  • keep US interest rates at their peak above 5% for a longer-than-previously expected length of time
  • lower their benchmark rates by “only” 50 basis points in 2024, which is half of the 100-bps in rate cuts previously forecasted by FOMC officials (via their “dot plot) back in June.

Set against such expectations, Powell and co. may be looking to further impress their hawkish messaging onto traders and investors worldwide in this final week of September.

As things stand, existing expectations for the Fed’s policy settings have already lifted the benchmark US dollar index to its highest levels since March.

NOTE: The Euro accounts for 57.6% of this US dollar index, which measures how the greenback performs against a basket of major peers, including the Japanese Yen, British Pound, Canadian Dollar, Swedish Krona, and Swiss Franc.

 

Also look out for Friday’s release (Sept 29th) of the Fed’s preferred measure of inflation, the PCE Deflator.

That set of data is expected to show a mixed picture, based on current forecasts by economists:

  • PCE Deflator month-on-month (Aug 2023 vs. July 2023): 0.5% estimate.
    If so, that would be higher than July’s 0.2% month-on-month number
  • PCE Deflator year-on-year (Aug 2023 vs. Aug 2022): 3.5% estimate.
    If so, that would be higher than July’s 3.3% year-on-year number
  • PCE Core Deflator month-on-month: 0.2% estimate.
    If so, that would match July’s 0.2% month-on-month number
  • PCE Core Deflator year-on-year: 3.9% estimate.
    If so, that would be lower than July’s 4.2% year-on-year number

 

 

POTENTIAL SCENARIOS

  • EURUSD may be dragged to a fresh 6-month low if the coming week’s data out of Germany/Eurozone further sours the bloc’s economic outlook and narrows the ECB’s chances at one last rate hike in this cycle, while the US PCE Deflators and Fed speak strengthen the case for one final Fed rate hike in this cycle.
  • EURUSD may be offered relief and move back higher on better-than-expected economic data out of the Eurozone/Germany, while the US PCE Deflators come in below forecasts which dilute the case for one final Fed rate hike in this cycle.

 

Key levels

At the time of writing, Bloomberg’s FX model points to a 74% chance that EURUSD will trade within the 1.0542 – 1.0770 range over the next one-week period.

Here are some notable price levels within that range for further consideration:
POTENTIAL RESISTANCE

  • 1.06800: support turned resistance level since Dec 2022
  • 1.07369: intraday high on Sept 20th, also around 21-day simple moving average (SMA)
  • 1.07700: upper bound of Bloomberg’s FX model

POTENTIAL SUPPORT

  • 1.06170: intraday low on Sept 21st
  • 1.06000: psychologically-important level
  • 1.05160 – 1.0542: price region between Q1 2023 intraday low and lower bound of Bloomberg model forecasted range

Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Forex and Currency News Opinions
19 Sep

Japanese Candlesticks Analysis 19.09.2023 (EURUSD, USDJPY, EURGBP)

By RoboForex.com

EURUSD, “Euro vs US Dollar”

EURUSD has formed a Hammer reversal pattern on H4 near the support level. Currently, the instrument is going by the reversal signal in an ascending wave. The pullback target could be the resistance level of 1.0720. However, the price could drop to 1.0625 and continue the downtrend without testing the resistance.

EURUSD
Risk Warning: the result of previous trading operations do not guarantee the same results in the future

USDJPY, “US Dollar vs Japanese Yen”

USDJPY has formed a Hanging Man reversal pattern on H4. Currently, the instrument is going by the reversal signal in a descending wave. The pullback target might be 147.45. However, the price could rise to 148.50 and continue the uptrend without testing the support.

USDJPY
Risk Warning: the result of previous trading operations do not guarantee the same results in the future

EURGBP, “Euro vs Great Britain Pound”

EURGBP has formed an Inverted Hammer reversal pattern on H4. Currently, the instrument is going by the reversal signal in an ascending wave. The growth target could be 0.8655. Upon testing and breaking this level, the price could continue the uptrend. However, the quotes might correct to 0.8610 before rising.

EURGBP

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
18 Sep

Coverage Account – Bucketing and Auto Hedging Plugin for MT5 by Your Bourse

Coverage Account – Bucketing and Auto Hedging Plugin for MT5 by Your Bourse

The Coverage Plugin in MT5 is a powerful tool that enables various functions and capabilities within the trading platform. Its primary function is to accumulate opened position volumes from the trading account on the same MT5 server. However, it offers much more than that. In this article, we will explore the features and setup process of the Coverage Plugin, and delve into different scenarios where it can be utilised effectively.

Understanding the Coverage Plugin

The Coverage Plugin in MT5 serves multiple functions, including accumulating position volumes from the trading account on the same server. Additionally, the Your Bourse plugin offers several other capabilities:

  1. Volume Hedging: It enables hedging the volume of lots from the trading accounts to the coverage accounts. The function allows the accumulation of lots from one of the trading accounts to the trading account on the same or different servers.
  2. Symbol Mappings: This capability allows the translation of mapped symbols to core symbols or other mapped symbols. For example, it enables the transfer of volumes from EURUSD.m on the trading account to EURUSD in the coverage account.
  3. Exposure Auto Hedging: This functionality allows for exposure full or partial hedging from B-book to A-book with the possibility to set up a particular volume step increment.
  4. Conditional Hedging: Under certain conditions, such as when the order volume on the B-book exceeds five lots, all customised volume increments can be directed to the A-book coverage account.

Using Coverage Account Auto Hedging Functionality

The Coverage Hedging functionality can be used in various scenarios to suit different trading needs. Here are a few examples:

  1. Common Coverage Scenario: In this scenario, the trades opened or closed will be mirrored in the coverage accounts. This functionality can be enabled in MT5 Administrator.
  2. Mapping Symbols Scenario: This scenario involves transferring orders from mapped symbols in the trading account to core symbols or other mapped symbols on the coverage account. This can be easily configured from the YourBourse portal. When trades are executed on the trading account, corresponding orders will be opened on the coverage account.
  3. Unconditional Hedging Scenario: In this scenario, orders placed in the B-book trading account will be transferred to the B-book coverage account, and an increment value can be configured to be added to the A-book coverage account. The specified increment value will be automatically added to the A-book coverage account for each volume traded on the B-book account.
  4. Conditional Hedging Scenario: In this scenario, orders placed in B-book will be transferred to the B-book coverage account, and, based on specified conditions, a customised increment value will be added to the A-book coverage account. This transfer will occur only if the volume of the order exceeds a predefined unhedged threshold and therefore the position will be hedged.

Setting up Coverage Accounts

The Coverage Plugin consists of several important elements that can be configured on the Your Bourse portal.

To enable coverage hedging functionality, you need to install the coverage plugin, configure the rules on the Your Bourse portal, create trading and coverage accounts, and set up routing rules.

Conclusion

The Coverage Plugin in MT5 provides traders with a range of functionalities and features to enhance their trading experience. By understanding its setup process and various scenarios in which it can be utilised, traders can effectively hedge volumes, map symbols, and customise increments between trading and coverage accounts. The Coverage Plugin offers a versatile tool for risk management and trading strategies on the MT5 platform.

About Your Bourse

Your Bourse offers software solutions for the retail and institutional MT4/MT5 brokers. Including: MT5 gateway & MT4 bridge, multi-asset liquidity aggregation, risk management, client profiling, real-time and historical reporting, MT4/MT5 hosting in all Equinix data centers with 99.999% SLA, plugins for MT4 & MT5 and FIX API connections for the B2B clients.

Financial News Forex and Currency News
18 Sep

Trade Of The Week: GBPUSD Braces For Fed & BoE Combo

By ForexTime 

  • Fed/BoE combo could trigger GBPUSD volatility
  • Watch out for UK CPI report mid-week
  • Fed widely expected to leave rates unchanged
  • BoE expected to hike rates by 25 basis points
  • GBPUSD could see big moves, keep eye on 1.2430 level

A super central bank combo featuring the Federal Reserve and Bank of England may trigger extreme levels of volatility in the GBPUSD this week.

The past few months have been rocky for Sterling which is down roughly 2.4% in the second half of 2023 thus far.

Pound bears seem to be drawing strength from stagflation fears amid rising unemployment, sticky inflation, and stagnant economic growth.

Buying sentiment towards the currency has also been hit by disappointing economic data, further supporting Governor Andrew Bailey’s comments about the BoE nearing the end of its hiking cycle. Taking a glance at the technicals, the GBPUSD is approaching weekly support at 1.2310 – where the 50-week SMA resides.

The GBPUSD could see big moves this week and here and 3 reasons why…

  1. BoE rate decision

The Bank of England (BoE) monetary policy decision will be on Thursday 21st September.

24 hours before the BoE decision, the latest UK inflation figures will be published with markets forecasting CPI to rise 7.0%, up from the July print of 6.8%. Core inflation is projected to cool 6.8% year-on-year, down from 6.9% in the previous month. This report could influence expectations around what the BoE does beyond September.

Markets widely expect the BoE to raise interest rates by 25 basis points. This would be the 15th straight hike, taking the key rate to 5.5% – its highest level since 2007. The key question is whether this will be the final rate hike as policymakers weigh sticky inflation against growth concerns.

Traders are currently pricing in a 79% probability of a 25 basis point hike on Thursday, with the probability of another 25 basis point hike by December currently standing at 45%.

  • If the BoE raises rates and signals the possibility of another 25 basis point hike before the end of 2023, this could propel the GBPUSD higher.
  • A dovish sounding BoE that hikes interest rates but hints that this could be the final move for the remainder of 2023 may drag the GBPUSD lower.

  1. Fed rate decision

Markets widely expect the Federal Reserve to leave interest rates unchanged at 5.5% at the September 19-20 meeting.

Investors will direct their attention towards the economic projections, dot plots and press conference by Jerome Powell which could offer clues on future rate hikes.

  • The GBPUSD may find itself under renewed pressure if the Fed signals one more interest rate increase in 2023.
  • Should the central bank hint that it could be done with hikes for the rest of 2023, this may weaken the dollar – pushing the GBPUSD higher as a result.

  1. Bearish technical forces

The GBPUSD remains under pressure on the daily timeframe as there have been consistently lower lows and lower highs.

Prices are trading below the 50, 100, and 200-day SMA while the MACD trades below zero. Bears are certainly in a position of power with the recent daily close below the 200-day SMA opening the doors to further downside.

  • Sustained weakness below 1.2430 could encourage a decline towards 1.2310 and 1.2250, respectively.
  • Should prices push back above the 200-day SMA at 1.2430, this could spark a rebound back toward the 1.2540 level and 1.2646 where the 100-day SMA resides.

Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Financial News Forex and Currency News
17 Sep
The Euro against US dollar

Currency Speculators drop their Euro Bets to 43-Week Low on ECB Rates

By InvestMacro

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 September 12th and shows a quick view of how large market participants (for-profit speculators and commercial traders) were positioned in the futures markets. All currency positions are in direct relation to the US dollar where, for example, a bet for the euro is a bet that the euro will rise versus the dollar while a bet against the euro will be a bet that the euro will decline versus the dollar.

Weekly Speculator Changes led by Australian Dollar & US Dollar Index

The COT currency market speculator bets were overall lower this week as just three out of the eleven currency markets we cover had higher positioning while the other eight markets had lower speculator contracts.

Leading the gains for the currency markets was the Australian Dollar (4,004 contracts) with the US Dollar Index (2,712 contracts) and Bitcoin (193 contracts) also showing positive weeks.

The currencies seeing declines in speculator bets on the week were the EuroFX (-23,151 contracts) with the Canadian Dollar (-16,920 contracts), the Swiss Franc (-4,013 contracts), the Japanese Yen (-1,577 contracts), the Brazilian Real (-756 contracts), Mexican Peso (-650 contracts), the New Zealand Dollar (-620 contracts) and the British Pound (-210 contracts) also registering lower bets on the week.

Currency Traders drop their Euro Bets to 43-Week Low on ECB Rates

Highlighting the COT currency’s data this week is the dropping speculator positioning for the Euro Currency. Large speculative Euro positions dropped sharply this week by over -23,000 contracts and declined for a fourth consecutive week. Euro weekly positions have now decreased for the seventh time in the past eight weeks as well as in nine out of the past eleven weeks.

The Euro speculative standing still remains in a highly bullish level with the net position at a total of +113,080 contracts currently. However, the net position has now fallen by a total of -46,783 contracts in just the past four weeks and by a total of -65,752 contracts over the past eight weeks.

Overall, the Euro net speculator level has been above the +100,000 contract level for forty-six straight weeks and ascended to a 137-week high with a total net position of +187,089 contracts on May 16th – the most bullish point since a total of 188,116 contracts was reached on September 29th of 2020.

The European Central Bank has helped dampen the sentiment for the Euro currency as the bank raised its rate by 25 basis points to 4 percent on Thursday but signaled that there may be no more rate hikes on the docket. The ECB also revised their economic growth projections lower with the bank seeing just 0.7 percent growth in 2023. Following the announcement, many participants are expecting not to see further rate rises and even possible rate cuts if the economy continues to deteriorate.

The Euro currency spot price (versus the US Dollar) has been retreating mightily and this week declined for a ninth consecutive week. The EUR/USD exchange rate closed at 1.0735 on Friday with the low of the week hitting the lowest level since March. The EUR/USD had been as high as 1.1310 on July 18th before starting on its current nine-week downtrend.

 

Data Snapshot of Forex Market Traders | Columns Legend
Sep-12-2023OIOI-IndexSpec-NetSpec-IndexCom-NetCOM-IndexSmalls-NetSmalls-Index
USD Index40,982376,07135-7,727631,65626
EUR743,75960113,08067-149,9813336,90138
GBP227,4375446,17488-51,168174,99468
JPY270,85492-98,71311106,64488-7,93137
CHF49,94570-9,3383112,35162-3,01350
CAD217,08074-41,8831549,27590-7,3926
AUD256,219100-79,5331194,99090-15,45715
NZD67,487100-14,6201417,25787-2,63719
MXN235,7205066,87180-71,492194,62141
RUB20,93047,54331-7,15069-39324
BRL34,9691913,17753-15,160461,98353
Bitcoin15,423732,232100-2,543031120

 

Strength Scores led by Bitcoin & British Pound

COT 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) showed that the Bitcoin (100 percent) and the British Pound (88 percent) lead the currency markets this week. The Mexican Peso (80 percent), EuroFX (67 percent) and the Brazilian Real (53 percent) come in as the next highest in the weekly strength scores.

On the downside, the Australian Dollar (11 percent), the Japanese Yen (11 percent), the New Zealand Dollar (14 percent) and the Canadian Dollar (15 percent) come in at the lowest strength levels currently and are in Extreme-Bearish territory (below 20 percent).

Strength Statistics:
US Dollar Index (35.1 percent) vs US Dollar Index previous week (30.5 percent)
EuroFX (67.4 percent) vs EuroFX previous week (77.1 percent)
British Pound Sterling (87.8 percent) vs British Pound Sterling previous week (88.0 percent)
Japanese Yen (11.4 percent) vs Japanese Yen previous week (12.3 percent)
Swiss Franc (30.9 percent) vs Swiss Franc previous week (41.9 percent)
Canadian Dollar (15.5 percent) vs Canadian Dollar previous week (31.3 percent)
Australian Dollar (11.1 percent) vs Australian Dollar previous week (7.4 percent)
New Zealand Dollar (14.0 percent) vs New Zealand Dollar previous week (15.6 percent)
Mexican Peso (80.0 percent) vs Mexican Peso previous week (80.3 percent)
Brazilian Real (52.6 percent) vs Brazilian Real previous week (53.5 percent)
Bitcoin (100.0 percent) vs Bitcoin previous week (97.1 percent)

 

Bitcoin & US Dollar Index top the 6-Week Strength Trends

COT Strength Score Trends (or move index, calculates the 6-week changes in strength scores) showed that the Bitcoin (42 percent) and the US Dollar Index (5 percent) lead the past six weeks trends for the currencies.

The Canadian Dollar (-45 percent) leads the downside trend scores currently with the New Zealand Dollar (-44 percent), Brazilian Real (-26 percent) and the Australian Dollar (-26 percent) following next with lower trend scores.

Strength Trend Statistics:
US Dollar Index (4.9 percent) vs US Dollar Index previous week (-4.5 percent)
EuroFX (-24.7 percent) vs EuroFX previous week (-17.2 percent)
British Pound Sterling (-2.4 percent) vs British Pound Sterling previous week (-8.8 percent)
Japanese Yen (-11.6 percent) vs Japanese Yen previous week (-11.5 percent)
Swiss Franc (-1.6 percent) vs Swiss Franc previous week (8.5 percent)
Canadian Dollar (-45.0 percent) vs Canadian Dollar previous week (-28.4 percent)
Australian Dollar (-25.7 percent) vs Australian Dollar previous week (-30.0 percent)
New Zealand Dollar (-43.9 percent) vs New Zealand Dollar previous week (-35.4 percent)
Mexican Peso (-13.2 percent) vs Mexican Peso previous week (-12.4 percent)
Brazilian Real (-25.6 percent) vs Brazilian Real previous week (-22.9 percent)
Bitcoin (41.7 percent) vs Bitcoin previous week (40.4 percent)

Individual COT Forex Markets:

US Dollar Index Futures:

US Dollar Index Forex Futures COT ChartThe US Dollar Index large speculator standing this week totaled a net position of 6,071 contracts in the data reported through Tuesday. This was a weekly advance of 2,712 contracts from the previous week which had a total of 3,359 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 35.1 percent. The commercials are Bullish with a score of 63.5 percent and the small traders (not shown in chart) are Bearish with a score of 25.8 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

US DOLLAR INDEX StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:61.419.311.0
– Percent of Open Interest Shorts:46.538.17.0
– Net Position:6,071-7,7271,656
– Gross Longs:25,1457,9064,510
– Gross Shorts:19,07415,6332,854
– Long to Short Ratio:1.3 to 10.5 to 11.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):35.163.525.8
– Strength Index Reading (3 Year Range):BearishBullishBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:4.9-6.614.7

 

Euro Currency Futures:

Euro Currency Futures COT ChartThe Euro Currency large speculator standing this week totaled a net position of 113,080 contracts in the data reported through Tuesday. This was a weekly lowering of -23,151 contracts from the previous week which had a total of 136,231 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 67.4 percent. The commercials are Bearish with a score of 33.3 percent and the small traders (not shown in chart) are Bearish with a score of 37.9 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

EURO Currency StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:28.655.512.5
– Percent of Open Interest Shorts:13.475.77.5
– Net Position:113,080-149,98136,901
– Gross Longs:212,376412,96792,784
– Gross Shorts:99,296562,94855,883
– Long to Short Ratio:2.1 to 10.7 to 11.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):67.433.337.9
– Strength Index Reading (3 Year Range):BullishBearishBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-24.726.7-20.1

 

British Pound Sterling Futures:

British Pound Sterling Futures COT ChartThe British Pound Sterling large speculator standing this week totaled a net position of 46,174 contracts in the data reported through Tuesday. This was a weekly reduction of -210 contracts from the previous week which had a total of 46,384 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 87.8 percent. The commercials are Bearish-Extreme with a score of 17.0 percent and the small traders (not shown in chart) are Bullish with a score of 67.8 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

BRITISH POUND StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:42.835.414.1
– Percent of Open Interest Shorts:22.557.911.9
– Net Position:46,174-51,1684,994
– Gross Longs:97,36580,44132,133
– Gross Shorts:51,191131,60927,139
– Long to Short Ratio:1.9 to 10.6 to 11.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):87.817.067.8
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-2.48.7-23.9

 

Japanese Yen Futures:

Japanese Yen Forex Futures COT ChartThe Japanese Yen large speculator standing this week totaled a net position of -98,713 contracts in the data reported through Tuesday. This was a weekly reduction of -1,577 contracts from the previous week which had a total of -97,136 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 11.4 percent. The commercials are Bullish-Extreme with a score of 87.7 percent and the small traders (not shown in chart) are Bearish with a score of 37.3 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

JAPANESE YEN StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:14.167.813.3
– Percent of Open Interest Shorts:50.628.416.2
– Net Position:-98,713106,644-7,931
– Gross Longs:38,247183,58936,043
– Gross Shorts:136,96076,94543,974
– Long to Short Ratio:0.3 to 12.4 to 10.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):11.487.737.3
– Strength Index Reading (3 Year Range):Bearish-ExtremeBullish-ExtremeBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-11.611.4-7.8

 

Swiss Franc Futures:

Swiss Franc Forex Futures COT ChartThe Swiss Franc large speculator standing this week totaled a net position of -9,338 contracts in the data reported through Tuesday. This was a weekly fall of -4,013 contracts from the previous week which had a total of -5,325 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 30.9 percent. The commercials are Bullish with a score of 62.0 percent and the small traders (not shown in chart) are Bullish with a score of 50.3 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

SWISS FRANC StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:18.052.127.6
– Percent of Open Interest Shorts:36.727.433.6
– Net Position:-9,33812,351-3,013
– Gross Longs:9,00926,01713,771
– Gross Shorts:18,34713,66616,784
– Long to Short Ratio:0.5 to 11.9 to 10.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):30.962.050.3
– Strength Index Reading (3 Year Range):BearishBullishBullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-1.614.7-27.2

 

Canadian Dollar Futures:

Canadian Dollar Forex Futures COT ChartThe Canadian Dollar large speculator standing this week totaled a net position of -41,883 contracts in the data reported through Tuesday. This was a weekly reduction of -16,920 contracts from the previous week which had a total of -24,963 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 15.5 percent. The commercials are Bullish-Extreme with a score of 89.7 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 6.4 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

CANADIAN DOLLAR StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:18.660.814.6
– Percent of Open Interest Shorts:37.938.118.0
– Net Position:-41,88349,275-7,392
– Gross Longs:40,298131,97631,767
– Gross Shorts:82,18182,70139,159
– Long to Short Ratio:0.5 to 11.6 to 10.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):15.589.76.4
– Strength Index Reading (3 Year Range):Bearish-ExtremeBullish-ExtremeBearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-45.049.4-54.0

 

Australian Dollar Futures:

Australian Dollar Forex Futures COT ChartThe Australian Dollar large speculator standing this week totaled a net position of -79,533 contracts in the data reported through Tuesday. This was a weekly advance of 4,004 contracts from the previous week which had a total of -83,537 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 11.1 percent. The commercials are Bullish-Extreme with a score of 89.6 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 14.7 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

AUSTRALIAN DOLLAR StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:18.564.48.7
– Percent of Open Interest Shorts:49.527.314.7
– Net Position:-79,53394,990-15,457
– Gross Longs:47,309164,96122,273
– Gross Shorts:126,84269,97137,730
– Long to Short Ratio:0.4 to 12.4 to 10.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):11.189.614.7
– Strength Index Reading (3 Year Range):Bearish-ExtremeBullish-ExtremeBearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-25.728.7-24.3

 

New Zealand Dollar Futures:

New Zealand Dollar Forex Futures COT ChartThe New Zealand Dollar large speculator standing this week totaled a net position of -14,620 contracts in the data reported through Tuesday. This was a weekly lowering of -620 contracts from the previous week which had a total of -14,000 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 14.0 percent. The commercials are Bullish-Extreme with a score of 87.2 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 18.6 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

NEW ZEALAND DOLLAR StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:21.962.85.1
– Percent of Open Interest Shorts:43.637.29.0
– Net Position:-14,62017,257-2,637
– Gross Longs:14,79742,3953,420
– Gross Shorts:29,41725,1386,057
– Long to Short Ratio:0.5 to 11.7 to 10.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):14.087.218.6
– Strength Index Reading (3 Year Range):Bearish-ExtremeBullish-ExtremeBearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-43.945.2-35.5

 

Mexican Peso Futures:

Mexican Peso Futures COT ChartThe Mexican Peso large speculator standing this week totaled a net position of 66,871 contracts in the data reported through Tuesday. This was a weekly fall of -650 contracts from the previous week which had a total of 67,521 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 80.0 percent. The commercials are Bearish-Extreme with a score of 18.7 percent and the small traders (not shown in chart) are Bearish with a score of 40.7 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

MEXICAN PESO StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:39.552.43.1
– Percent of Open Interest Shorts:11.182.81.1
– Net Position:66,871-71,4924,621
– Gross Longs:93,022123,5757,268
– Gross Shorts:26,151195,0672,647
– Long to Short Ratio:3.6 to 10.6 to 12.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):80.018.740.7
– Strength Index Reading (3 Year Range):BullishBearish-ExtremeBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-13.212.80.5

 

Brazilian Real Futures:

Brazil Real Futures COT ChartThe Brazilian Real large speculator standing this week totaled a net position of 13,177 contracts in the data reported through Tuesday. This was a weekly decline of -756 contracts from the previous week which had a total of 13,933 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 52.6 percent. The commercials are Bearish with a score of 46.0 percent and the small traders (not shown in chart) are Bullish with a score of 52.9 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

BRAZIL REAL StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:56.333.19.5
– Percent of Open Interest Shorts:18.676.43.8
– Net Position:13,177-15,1601,983
– Gross Longs:19,69611,5683,305
– Gross Shorts:6,51926,7281,322
– Long to Short Ratio:3.0 to 10.4 to 12.5 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):52.646.052.9
– Strength Index Reading (3 Year Range):BullishBearishBullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-25.621.624.1

 

Bitcoin Futures:

Bitcoin Crypto Futures COT ChartThe Bitcoin large speculator standing this week totaled a net position of 2,232 contracts in the data reported through Tuesday. This was a weekly rise of 193 contracts from the previous week which had a total of 2,039 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 100.0 percent. The commercials are Bearish-Extreme with a score of 0.0 percent and the small traders (not shown in chart) are Bearish with a score of 20.0 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

BITCOIN StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:77.10.87.4
– Percent of Open Interest Shorts:62.617.25.3
– Net Position:2,232-2,543311
– Gross Longs:11,8931171,134
– Gross Shorts:9,6612,660823
– Long to Short Ratio:1.2 to 10.0 to 11.4 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):100.00.020.0
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:41.7-66.9-7.1

 

Article By InvestMacro – Receive our weekly COT Newsletter

*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.

COT Updates Forex and Currency News Opinions
12 Sep

Yen keeps posting flags through ascent

By ForexTime 

  • USDJPY busy forming second flag since August, amidst year-to-date uptrend
  • JPY surged Monday after BoJ Governor Ueda offered hawkish policy clues
  • Yen bulls unable to build on Monday’s intraday low of 145.904.
  • USDJPY may look to close Monday’s gap down
  • Tomorrow’s US CPI to decide USDJPY’s immediate fate

USDJPY gapped down on Monday, September 11th’s market open.

The Yen surged at the onset of the trading week after Bank of Japan governor Kazuo Ueda hinted at the possibility of a first rate hike in Japan since 2007!

The stronger Yen resulted in an intraday low of 145.904 for USDJPY.

This FX pair closed Monday at a zone which could serve as a demand zone-base for a possible second flag, in its ascent from the lows of 141.53 printed on August 7th, 2023.

This close is also below the significant 261.8 Fibonacci level when drawn from 134.772,  January 6th  high to the lows of 16th January 2023 at 127.224 on the weekly chart.

 

Attentions turn to the USD side of USDJPY, with the pivotal US consumer price index due to be released tomorrow (Wednesday, September 13th).

Both bears and bulls will be looking for price action around key levels for pointers to the next impulse direction for the USDJPY.

 

Bulls will be looking to close Monday’s open gap as they climb to the flag’s resistance around 147.769

They will however have to contend with the psychologically important Fibonacci level at 261.8 at 146.985.

 

A bullish flag breakout could see a test of the 148.850 region which had resisted USDJPY bulls back in late-October/early-November 2022.

Further north, lies the potential resistance zone of the upward sloping channel drawn from January 5th, 2023.

 

USDJPY bears on the other hand will be looking for a strong close below the current bullish flag’s support, and also below the psychologically-important 146.00 line.

Such price action may indicate a reversion to its 50-EMA which is below and more than  2600 points away from the current price at the time of writing.

 

Ultimately, much of USDJPY’s immediate fate should rest on tomorrow’s US inflation data release.

  • A higher-than-expected CPI (consumer price index) that ramps up bets of one further Fed rate hike by end-2023 should bolster the US dollar and potentially send USDJPY higher.
  • However, a lower-than-expected CPI that solidifies hopes that the Fed is truly done with its rate hikes should soften the US dollar and potentially drag USDJPY lower.

Forex-Time-LogoArticle by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Forex and Currency News Opinions
11 Sep

EUR/USD Braces for Pivotal Week Ahead: An In-Depth Look

By RoboForex Analytical Department

The EUR/USD currency pair kicked off the week on a vibrant note, trading around 1.0720. The days ahead promise a series of impactful events that could influence the pair’s trajectory.

In the U.S., critical inflation data for August is set to be released this week. Year-over-year Consumer Price Index (CPI) figures are expected to have increased to 3.6%, up from 3.2% the prior month. On the eve of the Federal Reserve’s upcoming meeting, this uptick could bring mixed sentiments. In contrast, core inflation is projected to decline to 4.3% year-over-year from the previous 4.7%.

Across the Atlantic, the European Central Bank (ECB) is scheduled to convene on Thursday to determine interest rate policy. Given the precarious state of the Eurozone’s economy, the consensus expectation is that the ECB will opt to maintain its current interest rate of 3.75% per annum. Any statements or actions from the ECB are expected to significantly influence the euro’s value.

Technical Analysis of the EUR/USD Currency Pair

On the 4-hour chart, EUR/USD recently completed a downward wave at 1.0686. In the short term, the market could experience a corrective rally towards 1.0755. Upon reaching this level, a fresh downward structure targeting 1.0680 may ensue. Subsequently, a bullish wave could set its sights on 1.0911. The Moving Average Convergence Divergence (MACD) indicator lends technical support to this scenario; its signal line is currently below zero but appears to be gearing up for an upward move.

On the 1-hour chart, a consolidation zone has taken shape around 1.0720. The market at one point extended this range upward and could potentially trend towards 1.0755. Once this price level is attained, a downward movement towards 1.0680 may commence. This viewpoint gains technical validation from the Stochastic oscillator, whose signal line has recently recoiled from the 80 mark and is now oriented downward, possibly heading towards the 20 level.

In summary, the EUR/USD pair faces a week rich in potential catalysts, with key data releases and policy meetings in both the U.S. and Eurozone. Both short-term and medium-term technical analyses suggest a mixed outlook, with opportunities for both upward corrections and renewed declines. Keep a close eye on economic indicators and central bank actions as they could drastically alter the landscape.

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
10 Sep

Currency Speculators drop Australian Dollar bets for 9th time in 10 weeks

By InvestMacro

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 September 5th and shows a quick view of how large market participants (for-profit speculators and commercial traders) were positioned in the futures markets. All currency positions are in direct relation to the US dollar where, for example, a bet for the euro is a bet that the euro will rise versus the dollar while a bet against the euro will be a bet that the euro will decline versus the dollar.

Weekly Speculator Changes led by US Dollar Index & Bitcoin

The COT currency market speculator bets were lower this week as three out of the eleven currency markets we cover had higher positioning while the other eight markets had lower speculator contracts.

Leading the gains for the currency markets was the Japanese Yen (1,337 contracts) with the US Dollar Index (536 contracts) and Bitcoin (532 contracts) also showing positive weeks.

The currencies seeing declines in speculator bets on the week were the Australian Dollar (-13,352 contracts), EuroFX (-10,448 contracts), Canadian Dollar (-9,202 contracts), the Mexican Peso (-6,342 contracts), the New Zealand Dollar (-3,624 contracts), Brazilian Real (-2,655 contracts), the British Pound (-2,017 contracts) and the Swiss Franc (-807 contracts) also registering lower bets on the week.

Large Currency Speculators drop Australian Dollar bets for 9th time in 10 weeks

Highlighting the COT currency’s data this week is the continued weakness of the speculator’s positioning for the Australian dollar. Large speculative currency positions for the Aussie dropped this week by over -13,000 net contracts and fell for the fourth consecutive week as well as for the ninth time out of the past ten weeks.

The AUD positioning has now shed a total of -40,345 contracts over these past four weeks and this has brought the overall net speculator standing (currently at -83,352 contracts) to the lowest level in the past eighty weeks, dating back to February 2nd of 2022 when the net position was -84,080 contracts. The 3-Year Strength Index is showing a 7.4 percent score for the AUD, marking an extreme bearish reading for speculators this week.

The Australian dollar has been in a downtrend over the course in 2023 after opening the year at approximately the 0.6815 exchange rate and this week touched the lowest level since November of 2022 at a low of 0.6360.

Hurting the AUD’s exchange against the US Dollar is the interest rate disparity and the possible future divergence of the central banks with the US Federal Reserve possibly continuing to raise its benchmark rate (currently at 5.25-5.50%) while the Reserve Bank of Australia is assumed to be finished boosting its rate (currently at 4.10%).

Data Snapshot of Forex Market Traders | Columns Legend
Sep-05-2023OIOI-IndexSpec-NetSpec-IndexCom-NetCOM-IndexSmalls-NetSmalls-Index
USD Index36,579263,35931-5,005681,64626
EUR754,26365136,23177-175,8542439,62342
GBP225,4045246,38488-49,955183,57165
JPY268,34490-97,13612105,86787-8,73136
CHF46,67059-5,3254210,68759-5,36242
CAD189,66055-24,9633129,46176-4,49813
AUD241,201100-83,537795,36690-11,82924
NZD56,46279-14,0001617,29187-3,29111
MXN246,0615467,52180-71,732194,21138
RUB20,93047,54331-7,15069-39324
BRL34,8711913,93354-15,569461,63650
Bitcoin14,962692,039100-2,534049524

 

Strength Scores led by Bitcoin & British Pound

COT 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) showed that the Bitcoin (100 percent) and the British Pound (88 percent) lead the currency markets this week. The Mexican Peso (80 percent), EuroFX (77 percent) and the Brazilian Real (54 percent) come in as the next highest in the weekly strength scores.

On the downside, the Australian Dollar (7 percent), the Japanese Yen (12 percent) and the New Zealand Dollar (16 percent) come in at the lowest strength levels currently and are in Extreme-Bearish territory (below 20 percent).

Strength Statistics:
US Dollar Index (30.5 percent) vs US Dollar Index previous week (29.6 percent)
EuroFX (77.1 percent) vs EuroFX previous week (81.5 percent)
British Pound Sterling (88.0 percent) vs British Pound Sterling previous week (89.4 percent)
Japanese Yen (12.3 percent) vs Japanese Yen previous week (11.5 percent)
Swiss Franc (41.9 percent) vs Swiss Franc previous week (44.1 percent)
Canadian Dollar (31.3 percent) vs Canadian Dollar previous week (39.8 percent)
Australian Dollar (7.4 percent) vs Australian Dollar previous week (19.8 percent)
New Zealand Dollar (15.6 percent) vs New Zealand Dollar previous week (25.5 percent)
Mexican Peso (80.3 percent) vs Mexican Peso previous week (84.2 percent)
Brazilian Real (53.5 percent) vs Brazilian Real previous week (56.9 percent)
Bitcoin (100.0 percent) vs Bitcoin previous week (91.8 percent)

 

Bitcoin & Swiss Franc top the 6-Week Strength Trends

COT Strength Score Trends (or move index, calculates the 6-week changes in strength scores) showed that the Bitcoin (42 percent) and the Swiss Franc (8 percent) lead the past six weeks trends for the currencies.

The New Zealand Dollar (-35 percent) leads the downside trend scores currently with the Australian Dollar (-30 percent), the Canadian Dollar (-28 percent) and the Brazilian Real (-23 percent) following next with lower trend scores.

Strength Trend Statistics:
US Dollar Index (-4.5 percent) vs US Dollar Index previous week (-13.7 percent)
EuroFX (-17.2 percent) vs EuroFX previous week (-13.5 percent)
British Pound Sterling (-8.8 percent) vs British Pound Sterling previous week (-10.6 percent)
Japanese Yen (-11.5 percent) vs Japanese Yen previous week (-4.9 percent)
Swiss Franc (8.5 percent) vs Swiss Franc previous week (15.6 percent)
Canadian Dollar (-28.4 percent) vs Canadian Dollar previous week (-15.2 percent)
Australian Dollar (-30.0 percent) vs Australian Dollar previous week (-18.3 percent)
New Zealand Dollar (-35.4 percent) vs New Zealand Dollar previous week (-18.3 percent)
Mexican Peso (-12.4 percent) vs Mexican Peso previous week (-12.6 percent)
Brazilian Real (-22.9 percent) vs Brazilian Real previous week (-22.1 percent)
Bitcoin (41.6 percent) vs Bitcoin previous week (41.4 percent)

Individual COT Forex Markets:

US Dollar Index Futures:

US Dollar Index Forex Futures COT ChartThe US Dollar Index large speculator standing this week came in at a net position of 3,359 contracts in the data reported through Tuesday. This was a weekly increase of 536 contracts from the previous week which had a total of 2,823 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 30.5 percent. The commercials are Bullish with a score of 67.8 percent and the small traders (not shown in chart) are Bearish with a score of 25.6 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

US DOLLAR INDEX StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:62.620.412.5
– Percent of Open Interest Shorts:53.434.08.0
– Net Position:3,359-5,0051,646
– Gross Longs:22,8817,4484,587
– Gross Shorts:19,52212,4532,941
– Long to Short Ratio:1.2 to 10.6 to 11.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):30.567.825.6
– Strength Index Reading (3 Year Range):BearishBullishBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-4.52.116.9

 

Euro Currency Futures:

Euro Currency Futures COT ChartThe Euro Currency large speculator standing this week came in at a net position of 136,231 contracts in the data reported through Tuesday. This was a weekly decline of -10,448 contracts from the previous week which had a total of 146,679 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 77.1 percent. The commercials are Bearish with a score of 23.7 percent and the small traders (not shown in chart) are Bearish with a score of 42.2 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: New Sell – Short Position.

EURO Currency StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:31.353.911.9
– Percent of Open Interest Shorts:13.277.26.7
– Net Position:136,231-175,85439,623
– Gross Longs:235,732406,48590,003
– Gross Shorts:99,501582,33950,380
– Long to Short Ratio:2.4 to 10.7 to 11.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):77.123.742.2
– Strength Index Reading (3 Year Range):BullishBearishBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-17.221.8-27.8

 

British Pound Sterling Futures:

British Pound Sterling Futures COT ChartThe British Pound Sterling large speculator standing this week came in at a net position of 46,384 contracts in the data reported through Tuesday. This was a weekly reduction of -2,017 contracts from the previous week which had a total of 48,401 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 88.0 percent. The commercials are Bearish-Extreme with a score of 17.7 percent and the small traders (not shown in chart) are Bullish with a score of 65.0 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

BRITISH POUND StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:41.137.315.0
– Percent of Open Interest Shorts:20.559.513.4
– Net Position:46,384-49,9553,571
– Gross Longs:92,64584,12933,867
– Gross Shorts:46,261134,08430,296
– Long to Short Ratio:2.0 to 10.6 to 11.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):88.017.765.0
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-8.815.1-28.3

 

Japanese Yen Futures:

Japanese Yen Forex Futures COT ChartThe Japanese Yen large speculator standing this week came in at a net position of -97,136 contracts in the data reported through Tuesday. This was a weekly lift of 1,337 contracts from the previous week which had a total of -98,473 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 12.3 percent. The commercials are Bullish-Extreme with a score of 87.3 percent and the small traders (not shown in chart) are Bearish with a score of 35.7 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

JAPANESE YEN StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:13.871.113.0
– Percent of Open Interest Shorts:50.031.716.3
– Net Position:-97,136105,867-8,731
– Gross Longs:37,014190,80434,930
– Gross Shorts:134,15084,93743,661
– Long to Short Ratio:0.3 to 12.2 to 10.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):12.387.335.7
– Strength Index Reading (3 Year Range):Bearish-ExtremeBullish-ExtremeBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-11.59.40.1

 

Swiss Franc Futures:

Swiss Franc Forex Futures COT ChartThe Swiss Franc large speculator standing this week came in at a net position of -5,325 contracts in the data reported through Tuesday. This was a weekly decrease of -807 contracts from the previous week which had a total of -4,518 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 41.9 percent. The commercials are Bullish with a score of 59.1 percent and the small traders (not shown in chart) are Bearish with a score of 41.9 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

SWISS FRANC StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:24.648.226.1
– Percent of Open Interest Shorts:36.025.337.6
– Net Position:-5,32510,687-5,362
– Gross Longs:11,49422,50812,168
– Gross Shorts:16,81911,82117,530
– Long to Short Ratio:0.7 to 11.9 to 10.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):41.959.141.9
– Strength Index Reading (3 Year Range):BearishBullishBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:8.513.1-37.3

 

Canadian Dollar Futures:

Canadian Dollar Forex Futures COT ChartThe Canadian Dollar large speculator standing this week came in at a net position of -24,963 contracts in the data reported through Tuesday. This was a weekly fall of -9,202 contracts from the previous week which had a total of -15,761 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 31.3 percent. The commercials are Bullish with a score of 76.2 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 12.8 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: New Sell – Short Position.

CANADIAN DOLLAR StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:24.154.817.1
– Percent of Open Interest Shorts:37.339.319.5
– Net Position:-24,96329,461-4,498
– Gross Longs:45,761103,95932,462
– Gross Shorts:70,72474,49836,960
– Long to Short Ratio:0.6 to 11.4 to 10.9 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):31.376.212.8
– Strength Index Reading (3 Year Range):BearishBullishBearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-28.435.1-46.8

 

Australian Dollar Futures:

Australian Dollar Forex Futures COT ChartThe Australian Dollar large speculator standing this week came in at a net position of -83,537 contracts in the data reported through Tuesday. This was a weekly decline of -13,352 contracts from the previous week which had a total of -70,185 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 7.4 percent. The commercials are Bullish-Extreme with a score of 90.1 percent and the small traders (not shown in chart) are Bearish with a score of 23.6 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

AUSTRALIAN DOLLAR StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:22.460.610.0
– Percent of Open Interest Shorts:57.021.114.9
– Net Position:-83,53795,366-11,829
– Gross Longs:54,032146,17624,035
– Gross Shorts:137,56950,81035,864
– Long to Short Ratio:0.4 to 12.9 to 10.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):7.490.123.6
– Strength Index Reading (3 Year Range):Bearish-ExtremeBullish-ExtremeBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-30.034.2-32.8

 

New Zealand Dollar Futures:

New Zealand Dollar Forex Futures COT ChartThe New Zealand Dollar large speculator standing this week came in at a net position of -14,000 contracts in the data reported through Tuesday. This was a weekly fall of -3,624 contracts from the previous week which had a total of -10,376 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 15.6 percent. The commercials are Bullish-Extreme with a score of 87.2 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 10.8 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

NEW ZEALAND DOLLAR StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:29.860.35.2
– Percent of Open Interest Shorts:54.629.711.0
– Net Position:-14,00017,291-3,291
– Gross Longs:16,84734,0682,947
– Gross Shorts:30,84716,7776,238
– Long to Short Ratio:0.5 to 12.0 to 10.5 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):15.687.210.8
– Strength Index Reading (3 Year Range):Bearish-ExtremeBullish-ExtremeBearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-35.440.7-50.0

 

Mexican Peso Futures:

Mexican Peso Futures COT ChartThe Mexican Peso large speculator standing this week came in at a net position of 67,521 contracts in the data reported through Tuesday. This was a weekly lowering of -6,342 contracts from the previous week which had a total of 73,863 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 80.3 percent. The commercials are Bearish-Extreme with a score of 18.6 percent and the small traders (not shown in chart) are Bearish with a score of 38.0 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

MEXICAN PESO StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:40.851.82.9
– Percent of Open Interest Shorts:13.380.91.2
– Net Position:67,521-71,7324,211
– Gross Longs:100,298127,3727,084
– Gross Shorts:32,777199,1042,873
– Long to Short Ratio:3.1 to 10.6 to 12.5 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):80.318.638.0
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-12.412.1-0.0

 

Brazilian Real Futures:

Brazil Real Futures COT ChartThe Brazilian Real large speculator standing this week came in at a net position of 13,933 contracts in the data reported through Tuesday. This was a weekly decrease of -2,655 contracts from the previous week which had a total of 16,588 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 53.5 percent. The commercials are Bearish with a score of 45.5 percent and the small traders (not shown in chart) are Bearish with a score of 49.7 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

BRAZIL REAL StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:58.730.69.5
– Percent of Open Interest Shorts:18.875.34.8
– Net Position:13,933-15,5691,636
– Gross Longs:20,47310,6813,318
– Gross Shorts:6,54026,2501,682
– Long to Short Ratio:3.1 to 10.4 to 12.0 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):53.545.549.7
– Strength Index Reading (3 Year Range):BullishBearishBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:-22.920.215.4

 

Bitcoin Futures:

Bitcoin Crypto Futures COT ChartThe Bitcoin large speculator standing this week came in at a net position of 2,039 contracts in the data reported through Tuesday. This was a weekly increase of 532 contracts from the previous week which had a total of 1,507 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 100.0 percent. The commercials are Bearish-Extreme with a score of 0.0 percent and the small traders (not shown in chart) are Bearish with a score of 24.2 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

BITCOIN StatisticsSPECULATORSCOMMERCIALSSMALL TRADERS
– Percent of Open Interest Longs:79.80.78.1
– Percent of Open Interest Shorts:66.117.64.8
– Net Position:2,039-2,534495
– Gross Longs:11,9331051,218
– Gross Shorts:9,8942,639723
– Long to Short Ratio:1.2 to 10.0 to 11.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):100.00.024.2
– Strength Index Reading (3 Year Range):Bullish-ExtremeBearish-ExtremeBearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:41.6-64.3-7.5

 

Article By InvestMacro – Receive our weekly COT Newsletter

*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.

COT Updates Forex and Currency News Opinions
09 Sep

Speculator Extremes: Bitcoin, Cocoa, MSCI EAFE lead Bullish & Bearish Bets

By InvestMacro
The latest update for the weekly Commitment of Traders (COT) report was released by the Commodity Futures Trading Commission (CFTC) on Friday for data ending on September 5th.

This weekly Extreme Positions report highlights the Most Bullish and Most Bearish Positions for the speculator category. Extreme positioning in these markets can foreshadow strong moves in the underlying market.

To signify an extreme position, we use the Strength Index (also known as the COT Index) of each instrument, a common method of measuring COT data. The Strength Index is simply a comparison of current trader positions against the range of positions over the previous 3 years. We use over 80 percent as extremely bullish and under 20 percent as extremely bearish. (Compare Strength Index scores across all markets in the data table or cot leaders table)

Here Are This Week’s Most Bullish Speculator Positions:

Bitcoin


The Bitcoin speculator position comes in as the most bullish extreme standing this week. The Bitcoin speculator level is currently at a 100.0 percent score of its 3-year range.

The six-week trend for the percent strength score totaled 41.6 this week. The overall net speculator position was a total of 2,039 net contracts this week with a change of 532 contract in the weekly speculator bets.

Cocoa Futures


The Cocoa Futures speculator position comes next in the extreme standings this week. The Cocoa Futures speculator level is now at a 100.0 percent score of its 3-year range.

The six-week trend for the percent strength score was 8.7 this week. The speculator position registered 86,220 net contracts this week with a weekly change of 2,999 contracts in speculator bets.

Speculators or Non-Commercials Notes:

Speculators, classified as non-commercial traders by the CFTC, are made up of large commodity funds, hedge funds and other significant for-profit participants. The Specs are generally regarded as trend-followers in their behavior towards price action – net speculator bets and prices tend to go in the same directions. These traders often look to buy when prices are rising and sell when prices are falling. To illustrate this point, many times speculator contracts can be found at their most extremes (bullish or bearish) when prices are also close to their highest or lowest levels.

These extreme levels can be dangerous for the large speculators as the trade is most crowded, there is less trading ammunition still sitting on the sidelines to push the trend further and prices have moved a significant distance. When the trend becomes exhausted, some speculators take profits while others look to also exit positions when prices fail to continue in the same direction. This process usually plays out over many months to years and can ultimately create a reverse effect where prices start to fall and speculators start a process of selling when prices are falling.

3-Month Secured Overnight Financing Rate


The 3-Month Secured Overnight Financing Rate speculator position comes in third this week in the extreme standings. The 3-Month Secured Overnight Financing Rate speculator level resides at a 96.4 percent score of its 3-year range.

The six-week trend for the speculator strength score came in at 18.2 this week. The overall speculator position was 272,072 net contracts this week with a change of -53,150 contracts in the weekly speculator bets.

Heating Oil


The Heating Oil speculator position comes up number four in the extreme standings this week. The Heating Oil speculator level is at a 95.6 percent score of its 3-year range.

The six-week trend for the speculator strength score totaled a change of 25.9 this week. The overall speculator position was 38,737 net contracts this week with a change of -715 contracts in the speculator bets.

British Pound


The British Pound speculator position rounds out the top five in this week’s bullish extreme standings. The British Pound speculator level sits at a 88.0 percent score of its 3-year range. The six-week trend for the speculator strength score was -8.8 this week.

The speculator position was 46,384 net contracts this week with a change of -2,017 contracts in the weekly speculator bets.

This Week’s Most Bearish Speculator Positions:

MSCI EAFE MINI


The MSCI EAFE MINI speculator position comes in as the most bearish extreme standing this week. The MSCI EAFE MINI speculator level is at a 0.0 percent score of its 3-year range.

The six-week trend for the speculator strength score was -8.5 this week. The overall speculator position was -38,079 net contracts this week with a change of -11,282 contracts in the speculator bets.

Palladium


The Palladium speculator position comes in next for the most bearish extreme standing on the week. The Palladium speculator level is at a 0.0 percent score of its 3-year range.

The six-week trend for the speculator strength score was -17.9 this week. The speculator position was -11,021 net contracts this week with a change of -1,045 contracts in the weekly speculator bets.

Corn


The Corn speculator position comes in as third most bearish extreme standing of the week. The Corn speculator level resides at a 2.7 percent score of its 3-year range.

The six-week trend for the speculator strength score was -19.0 this week. The overall speculator position was -45,632 net contracts this week with a change of -9,819 contracts in the speculator bets.

2-Year Bond


The 2-Year Bond speculator position comes in as this week’s fourth most bearish extreme standing. The 2-Year Bond speculator level is at a 3.9 percent score of its 3-year range.

The six-week trend for the speculator strength score was -5.3 this week. The speculator position was -1,217,890 net contracts this week with a change of -48,034 contracts in the weekly speculator bets.

10-Year Note


Finally, the 10-Year Note speculator position comes in as the fifth most bearish extreme standing for this week. The 10-Year Note speculator level is at a 5.7 percent score of its 3-year range.

The six-week trend for the speculator strength score was -16.3 this week. The speculator position was -791,535 net contracts this week with a change of 14,018 contracts in the weekly speculator bets.

Article By InvestMacro – Receive our weekly COT Newsletter

*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.

COT Updates Forex and Currency News Opinions
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