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Speculators raise New Zealand Dollar bets after drop to all-time low

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 January 21st 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 New Zealand Dollar & Brazilian Real

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

Leading the gains for the currency markets was the Canadian Dollar (16,366 contracts), the Japanese Yen (14,738 contracts), the Australian Dollar (6,335 contracts), the US Dollar Index (2,143 contracts), the New Zealand Dollar (866 contracts) and the Brazilian Real (743 contracts) also showing positive weeks.

The currencies seeing declines in speculator bets on the week were the British Pound (-8,695 contracts), the Mexican Peso (-7,541 contracts), the Swiss Franc (-3,136 contracts), the EuroFX (-2,089 contracts) and with Bitcoin (-596 contracts) also registering lower bets on the week.

Speculators raise New Zealand Dollar bets after drop to all-time low

Highlighting the COT currency’s data this week is the recent speculator’s positioning for the New Zealand ‘Kiwi’ Dollar.

Large speculative New Zealand Dollar (NZD) currency positions rose modestly this week by +866 net contracts and have gained for two consecutive weeks. This follows significant weakness in the position over the past few months. The NZD spec position had declined for the previous five straight weeks and for thirteen out of the prior fourteen weeks for a total decline of -56,594 contracts over that period dating back to October.

This NZD weakness of the fourth quarter and into the first quarter of 2025 dropped the NZD speculator position into the lowest or most bearish level on record at -54,624 contracts on January 7th – surpassing the previous lows in 2019.

The NZD exchange rate versus the US Dollar has been on the decline in tandem with the drop in speculator bets, particularly since September. The NZDUSD started to slide in September and fell through the 0.6000 exchange level in November and continued to fall in December and into January, dropping all the way to the 0.5540 level in early January. This marked the lowest standing for the NZDUSD since October 2022.

This week, the NZD bounced higher by over 2.00 percent and managed to close above the 0.5700 exchange rate for the first time since early December.

Currencies Net Speculators Leaderboard

Legend: Weekly Speculators Change | Speculators Current Net Position | Speculators Strength Score compared to last 3-Years (0-100 range)

Strength Scores led by Japanese Yen & Bitcoin

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 Japanese Yen (68 percent) and Bitcoin (67 percent) lead the currency markets this week.

On the downside, the New Zealand Dollar (4 percent), the EuroFX (5 percent), the Swiss Franc (16 percent) and the Brazilian Real (19.7 percent) come in at the lowest strength levels currently and are in Extreme-Bearish territory (below 20 percent).

3-Year Strength Statistics:
US Dollar Index (37.5 percent) vs US Dollar Index previous week (33.1 percent)
EuroFX (5.0 percent) vs EuroFX previous week (5.8 percent)
British Pound Sterling (32.4 percent) vs British Pound Sterling previous week (36.3 percent)
Japanese Yen (67.8 percent) vs Japanese Yen previous week (61.9 percent)
Swiss Franc (16.1 percent) vs Swiss Franc previous week (22.5 percent)
Canadian Dollar (20.4 percent) vs Canadian Dollar previous week (13.0 percent)
Australian Dollar (25.7 percent) vs Australian Dollar previous week (21.2 percent)
New Zealand Dollar (4.0 percent) vs New Zealand Dollar previous week (3.0 percent)
Mexican Peso (28.0 percent) vs Mexican Peso previous week (31.8 percent)
Brazilian Real (19.7 percent) vs Brazilian Real previous week (19.0 percent)
Bitcoin (67.4 percent) vs Bitcoin previous week (80.4 percent)

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

COT Strength Score Trends (or move index, calculates the 6-week changes in strength scores) showed that the US Dollar Index (38 percent) and Bitcoin (32 percent) lead the past six weeks trends for the currencies. The Canadian Dollar (14 percent) is the next highest positive movers in the 3-Year trends data.

The Australian Dollar (-57 percent) leads the downside trend scores currently with the New Zealand Dollar (-27 percent), Brazilian Real (-17 percent) and the Japanese Yen (-16 percent) following next with lower trend scores.

3-Year Strength Trends:
US Dollar Index (37.5 percent) vs US Dollar Index previous week (32.7 percent)
EuroFX (5.0 percent) vs EuroFX previous week (-1.1 percent)
British Pound Sterling (-15.9 percent) vs British Pound Sterling previous week (-8.5 percent)
Japanese Yen (-16.2 percent) vs Japanese Yen previous week (-12.7 percent)
Swiss Franc (-13.9 percent) vs Swiss Franc previous week (4.8 percent)
Canadian Dollar (13.8 percent) vs Canadian Dollar previous week (-3.5 percent)
Australian Dollar (-56.6 percent) vs Australian Dollar previous week (-70.3 percent)
New Zealand Dollar (-27.0 percent) vs New Zealand Dollar previous week (-33.7 percent)
Mexican Peso (-4.8 percent) vs Mexican Peso previous week (0.9 percent)
Brazilian Real (-16.8 percent) vs Brazilian Real previous week (-16.6 percent)
Bitcoin (31.8 percent) vs Bitcoin previous week (63.9 percent)

Individual COT Forex Markets:

US Dollar Index Futures:

The US Dollar Index large speculator standing this week reached a net position of 14,872 contracts in the data reported through Tuesday. This was a weekly increase of 2,143 contracts from the previous week which had a total of 12,729 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 37.5 percent. The commercials are Bullish with a score of 61.5 percent and the small traders (not shown in chart) are Bearish with a score of 40.6 percent.

Price Trend-Following Model: Weak Uptrend

Our weekly trend-following model classifies the current market price position as: Weak Uptrend.

US DOLLAR INDEX Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	63.0	24.6	9.0
– Percent of Open Interest Shorts:	30.5	60.7	5.4
– Net Position:	14,872	-16,520	1,648
– Gross Longs:	28,811	11,247	4,133
– Gross Shorts:	13,939	27,767	2,485
– Long to Short Ratio:	2.1 to 1	0.4 to 1	1.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	37.5	61.5	40.6
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	37.5	-36.4	3.8

Euro Currency Futures:

The Euro Currency large speculator standing this week reached a net position of -62,486 contracts in the data reported through Tuesday. This was a weekly reduction of -2,089 contracts from the previous week which had a total of -60,397 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 Bearish-Extreme with a score of 5.0 percent. The commercials are Bullish-Extreme with a score of 96.3 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 13.6 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend.

EURO Currency Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	27.5	55.6	12.4
– Percent of Open Interest Shorts:	37.8	48.3	9.4
– Net Position:	-62,486	44,295	18,191
– Gross Longs:	167,665	338,719	75,560
– Gross Shorts:	230,151	294,424	57,369
– Long to Short Ratio:	0.7 to 1	1.2 to 1	1.3 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	5.0	96.3	13.6
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	5.0	-3.6	-5.9

British Pound Sterling Futures:

The British Pound Sterling large speculator standing this week reached a net position of -8,257 contracts in the data reported through Tuesday. This was a weekly fall of -8,695 contracts from the previous week which had a total of 438 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 32.4 percent. The commercials are Bullish with a score of 72.8 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 19.1 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend.

BRITISH POUND Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	35.6	52.6	10.3
– Percent of Open Interest Shorts:	39.5	39.1	19.9
– Net Position:	-8,257	28,749	-20,492
– Gross Longs:	75,696	111,968	21,903
– Gross Shorts:	83,953	83,219	42,395
– Long to Short Ratio:	0.9 to 1	1.3 to 1	0.5 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	32.4	72.8	19.1
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-15.9	20.2	-32.1

Japanese Yen Futures:

The Japanese Yen large speculator standing this week reached a net position of -14,673 contracts in the data reported through Tuesday. This was a weekly lift of 14,738 contracts from the previous week which had a total of -29,411 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 67.8 percent. The commercials are Bearish with a score of 31.7 percent and the small traders (not shown in chart) are Bullish with a score of 77.8 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend.

JAPANESE YEN Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	44.5	32.5	20.6
– Percent of Open Interest Shorts:	51.4	28.4	17.9
– Net Position:	-14,673	8,829	5,844
– Gross Longs:	94,157	68,868	43,642
– Gross Shorts:	108,830	60,039	37,798
– Long to Short Ratio:	0.9 to 1	1.1 to 1	1.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	67.8	31.7	77.8
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-16.2	12.3	16.9

Swiss Franc Futures:

The Swiss Franc large speculator standing this week reached a net position of -41,837 contracts in the data reported through Tuesday. This was a weekly decline of -3,136 contracts from the previous week which had a total of -38,701 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 16.1 percent. The commercials are Bullish-Extreme with a score of 93.6 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 11.3 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend.

SWISS FRANC Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	6.8	84.2	8.6
– Percent of Open Interest Shorts:	50.2	24.3	25.1
– Net Position:	-41,837	57,758	-15,921
– Gross Longs:	6,526	81,160	8,255
– Gross Shorts:	48,363	23,402	24,176
– Long to Short Ratio:	0.1 to 1	3.5 to 1	0.3 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	16.1	93.6	11.3
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-13.9	8.9	5.9

Canadian Dollar Futures:

The Canadian Dollar large speculator standing this week reached a net position of -150,787 contracts in the data reported through Tuesday. This was a weekly gain of 16,366 contracts from the previous week which had a total of -167,153 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 20.4 percent. The commercials are Bullish-Extreme with a score of 83.3 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 5.5 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend.

CANADIAN DOLLAR Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	5.9	84.0	8.2
– Percent of Open Interest Shorts:	51.3	34.8	11.9
– Net Position:	-150,787	163,078	-12,291
– Gross Longs:	19,503	278,535	27,246
– Gross Shorts:	170,290	115,457	39,537
– Long to Short Ratio:	0.1 to 1	2.4 to 1	0.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	20.4	83.3	5.5
– Strength Index Reading (3 Year Range):	Bearish	Bullish-Extreme	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	13.8	-13.5	5.5

Australian Dollar Futures:

The Australian Dollar large speculator standing this week reached a net position of -71,296 contracts in the data reported through Tuesday. This was a weekly gain of 6,335 contracts from the previous week which had a total of -77,631 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 25.7 percent. The commercials are Bullish with a score of 77.5 percent and the small traders (not shown in chart) are Bearish with a score of 26.7 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend.

AUSTRALIAN DOLLAR Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	16.4	67.0	12.7
– Percent of Open Interest Shorts:	53.9	25.0	17.2
– Net Position:	-71,296	79,799	-8,503
– Gross Longs:	31,179	127,375	24,195
– Gross Shorts:	102,475	47,576	32,698
– Long to Short Ratio:	0.3 to 1	2.7 to 1	0.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	25.7	77.5	26.7
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-56.6	48.0	-2.0

New Zealand Dollar Futures:

The New Zealand Dollar large speculator standing this week reached a net position of -51,223 contracts in the data reported through Tuesday. This was a weekly lift of 866 contracts from the previous week which had a total of -52,089 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 4.0 percent. The commercials are Bullish-Extreme with a score of 96.3 percent and the small traders (not shown in chart) are Bearish with a score of 20.1 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend.

NEW ZEALAND DOLLAR Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	9.9	85.8	3.9
– Percent of Open Interest Shorts:	66.4	26.4	6.8
– Net Position:	-51,223	53,841	-2,618
– Gross Longs:	8,938	77,776	3,551
– Gross Shorts:	60,161	23,935	6,169
– Long to Short Ratio:	0.1 to 1	3.2 to 1	0.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	4.0	96.3	20.1
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-27.0	25.1	13.0

Mexican Peso Futures:

The Mexican Peso large speculator standing this week reached a net position of -1,544 contracts in the data reported through Tuesday. This was a weekly fall of -7,541 contracts from the previous week which had a total of 5,997 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 28.0 percent. The commercials are Bullish with a score of 75.4 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 17.9 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend.

MEXICAN PESO Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	33.9	60.5	2.7
– Percent of Open Interest Shorts:	34.9	58.8	3.4
– Net Position:	-1,544	2,423	-879
– Gross Longs:	47,985	85,763	3,886
– Gross Shorts:	49,529	83,340	4,765
– Long to Short Ratio:	1.0 to 1	1.0 to 1	0.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	28.0	75.4	17.9
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-4.8	4.4	4.9

Brazilian Real Futures:

The Brazilian Real large speculator standing this week reached a net position of -34,131 contracts in the data reported through Tuesday. This was a weekly increase of 743 contracts from the previous week which had a total of -34,874 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 19.7 percent. The commercials are Bullish-Extreme with a score of 82.3 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 14.3 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend.

BRAZIL REAL Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	27.4	69.6	2.7
– Percent of Open Interest Shorts:	72.8	22.6	4.3
– Net Position:	-34,131	35,292	-1,161
– Gross Longs:	20,605	52,303	2,046
– Gross Shorts:	54,736	17,011	3,207
– Long to Short Ratio:	0.4 to 1	3.1 to 1	0.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	19.7	82.3	14.3
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-16.8	17.0	-2.1

Bitcoin Futures:

The Bitcoin large speculator standing this week reached a net position of 739 contracts in the data reported through Tuesday. This was a weekly fall of -596 contracts from the previous week which had a total of 1,335 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 38.3 percent and the small traders (not shown in chart) are Bearish with a score of 30.1 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend.

BITCOIN Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	75.5	4.2	3.9
– Percent of Open Interest Shorts:	73.6	6.8	3.2
– Net Position:	739	-1,007	268
– Gross Longs:	29,121	1,625	1,486
– Gross Shorts:	28,382	2,632	1,218
– Long to Short Ratio:	1.0 to 1	0.6 to 1	1.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	67.4	38.3	30.1
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	31.8	-31.0	-16.0

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.

26 Jan

Speculator Extremes: Coffee, Live Cattle & Gold lead weekly Bullish Positions

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 January 21st.

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:

Coffee

The Coffee speculator position comes in as the most bullish extreme standing this week. The Coffee speculator level is currently at a 98.3 percent score of its 3-year range.

The six-week trend for the percent strength score totaled 11.9 this week. The overall net speculator position was a total of 74,291 net contracts this week with an edge higher by 1,649 contract in the weekly 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.

Live Cattle

The Live Cattle speculator position comes next in the extreme standings this week. The Live Cattle speculator level is now at a 95.6 percent score of its 3-year range.

The six-week trend for the percent strength score was 15.5 this week. The speculator position registered 118,732 net contracts this week with a weekly decline of -4,553 contracts in speculator bets.

Gold

The Gold speculator position comes in third this week in the extreme standings. The Gold speculator level resides at a 94.5 percent score of its 3-year range.

The six-week trend for the speculator strength score came in at 9.6 this week. The overall speculator position was 300,784 net contracts this week with a gain by 21,421 contracts in the weekly speculator bets.

US Treasury Bond

The US Treasury Bond speculator position comes up number four in the extreme standings this week. The US Treasury Bond speculator level is at a 92.0 percent score of its 3-year range.

The six-week trend for the speculator strength score totaled a change of 22.3 this week. The overall speculator position was 24,456 net contracts this week with a boost of 24,404 contracts in the speculator bets.

Steel

The Steel speculator position rounds out the top five in this week’s bullish extreme standings. The Steel speculator level sits at a 89.5 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 -1,534 net contracts this week with a rise of 649 contracts in the weekly speculator bets.

This Week’s Most Bearish Speculator Positions:

Sugar

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

The six-week trend for the speculator strength score was -41.4 this week. The overall speculator position was -31,467 net contracts this week with a drop of -45,629 contracts in the speculator bets.

New Zealand Dollar

The New Zealand Dollar speculator position comes in next for the most bearish extreme standing on the week. The New Zealand Dollar speculator level is at a 4.0 percent score of its 3-year range.

The six-week trend for the speculator strength score was -27.0 this week. The speculator position was -51,223 net contracts this week with an edge higher by 866 contracts in the weekly speculator bets.

Cotton

The Cotton speculator position comes in as third most bearish extreme standing of the week. The Cotton speculator level resides at a 4.2 percent score of its 3-year range.

The six-week trend for the speculator strength score was -13.8 this week. The overall speculator position was -39,951 net contracts this week with a decrease of -4,210 contracts in the speculator bets.

Euro

The Euro speculator position comes in as this week’s fourth most bearish extreme standing. The Euro speculator level is at a 5.0 percent score of its 3-year range.

The six-week trend for the speculator strength score was 5.0 this week. The speculator position was -62,486 net contracts this week with a decline by -2,089 contracts in the weekly speculator bets.

5-Year Bond

Finally, the 5-Year Bond speculator position comes in as the fifth most bearish extreme standing for this week. The 5-Year Bond speculator level is at a 9.9 percent score of its 3-year range.

The six-week trend for the speculator strength score was -0.3 this week. The speculator position was -1,796,191 net contracts this week with a shortfall by -18,570 contracts in the weekly speculator bets.

Article By InvestMacro – Receive our weekly COT Newsletter

COT Updates Opinions Soft Commodities

24 Jan

Week Ahead: Big Tech back in the spotlight

By ForexTime

4 of “Magnificent 7” tech companies set to publish earnings

Combined market cap of 4 tech titans over $9.5 trillion

Meta could move over 7% ↑ or ↓ post-earnings

Apple second largest company in the world reports results Thursday

Beyond earnings, central banks & Trump in focus

Major central bank decisions and earnings from the largest companies in the world will dominate the week ahead:

Monday, 27th Jan

CN50: China industrial profits, manufacturing and non-manufacturing PMI
GER40: Germany IFO business climate
EUR: ECB President Christine Lagarde speech
SG20: Singapore unemployment

Tuesday, 28th Jan

USDInd: US consumer confidence, durable goods
US30: Boeing earnings

Wednesday, 29th Jan

AU200: Australia CPI
EU50: ASML earnings
CAD: Canada rate decision
SEK: Sweden rate decision
US500: Tesla, Microsoft, Meta earnings, Fed rate decision

Thursday, 30th Jan

EUR: ECB rate decision, consumer confidence, unemployment, GDP
GER40: Germany GDP
ZAR: South Africa rate decision
USDInd: US GDP, jobless claims
NAS100: Apple earnings

Friday, 31st Jan

GER40: Germany CPI, unemployment
JP225: Japan unemployment, Tokyo CPI, industrial production, retail sales
RUS2000: US personal income & spending, PCE inflation

Big tech earnings may hijack the headlines with the likes of Tesla, Microsoft, Meta and Apple set to reveal their latest quarterly results.

These major players with a combined market cap of over $9.5 trillion could provide fresh insights into how the industry fared last quarter.

Artificial intelligence is still a hot topic, but investors should consider a new variable President Trump. Whether it’s tougher tariffs or softer regulations, Trump is bound to influence big tech over the next four years.

Here is what you need to know:

1) Microsoft

Microsoft reports its fiscal second-quarter earnings on Wednesday 29th after US markets close.

Its shares are up 6% year-to-date, adding to the 12% gains secured in 2024. Microsoft has invested tens of billions of dollars into AI, but investors have yet to see the returns expected. So, the tech giant has little room for error with exceptional results required to justify its $3.32 trillion valuation. Much focus will be on the Azure side of the business which is likely to remain the driver of growth.

Markets forecast a 3.6% move, either up or down, for Microsoft stocks post-earnings.

microsoft

2) Meta

Meta is set to report fourth-quarter earnings after US markets close on Wednesday 29th.

Shares of the tech company have gained 9% this year, trading very close to all-time highs. Markets expect a year-over-year increase in earnings and revenue growth, but all eyes will be on the advertising business. Any insight into how the TikTok ban in the US will impact Meta’s ad sales and updates on Llama 4 will be welcomed by investors.

Markets are forecasting a 7.4% move, either up or down, for Meta stocks post-earnings.

meta2

3) Tesla

Tesla is also set to release its fourth-quarter earnings on Wednesday after the close of US trading.

A few weeks ago, Tesla reported its first decline in annual deliveries which hit sentiment toward its shares. Prices are up only 2% year-to-date, adding to the 62.5% gains secured in 2024. Any updates on the autonomous driving software, new vehicle launches, and revenues will be perused by investors to evaluate its business outlook.

Markets are forecasting an 8.2% move, either up or down, for Tesla stocks post-earnings.

tesla

4) Apple

The second most valuable company in the world with a market cap of $3.36 trillion reports its fiscal first-quarter earnings on Thursday 30th after US markets close.

Apple kicked off 2025 in a rough fashion, falling over 10% YTD amid growing concerns over lagging sales. Still, first-quarter revenues are expected to rise 3.8% year-on-year to $124.2 billion compared to $119.6 billion in the same quarter last year.

Nevertheless, investors will keep their eyes on the performance of iPhone sales and any initiatives integrating AI across its ecosystem.

Markets are projecting a 4% move, either up or down, for Apple stocks post-earnings.

Article by ForexTime

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

Opinions Stock Market News

23 Jan

I’m an economist. Here’s why I’m worried the California insurance crisis could trigger broader financial instability

By Gary W. Yohe, Wesleyan University

The devastating wildfires in Los Angeles have made one threat very clear: Climate change is undermining the insurance systems American homeowners rely on to protect themselves from catastrophes. This breakdown is starting to become painfully clear as families and communities struggle to rebuild.

But another threat remains less recognized: This collapse could pose a threat to the stability of financial markets well beyond the scope of the fires.

It’s been widely accepted for more than a decade that humanity has three choices when it comes to responding to climate risks: adapt, abate or suffer. As an expert in economics and the environment, I know that some degree of suffering is inevitable — after all, humans have already raised the average global temperature by 1.6 degrees Celsius, or 2.9 degrees Fahrenheit. That’s why it’s so important to have functioning insurance markets.

While insurance companies are often cast as villains, when the system works well, insurers play an important role in improving social welfare. When an insurer sets premiums that accurately reflect and communicate risk — what economists call “actuarially fair insurance” — that helps people share risk efficiently, leaving every individual safer and society better off.

But the scale and intensity of the Southern California fires — linked in part to climate change, including record-high global temperatures in 2023 and again in 2024 — has brought a big problem into focus: In a world impacted by increasing climate risk, traditional insurance models no longer apply.

How climate change broke insurance

Historically, the insurance system has worked by relying on experts who study records of past events to estimate how likely it is that a covered event might happen. They then use this information to determine how much to charge a given policyholder. This is called “pricing the risk.”

Many California wildfire survivors face insurance struggles, as this CBS Evening News report shows.

When Americans try to borrow money to buy a home, they expect that mortgage lenders will make them purchase and maintain a certain level of homeowners insurance coverage, even if they chose to self-insure against unlikely additional losses. But thanks to climate change, risks are increasingly difficult to measure, and costs are increasingly catastrophic. It seems clear to me that a new paradigm is needed.

California provided the beginnings of such a paradigm with its Fair Access to Insurance program, known as FAIR. When it was created in 1968, its authors expected that it would provide insurance coverage for the few owners who were unable to get normal policies because they faced special risks from exposure to unusual weather and local climates.

But the program’s coverage is capped at US$500,000 per property – well below the losses that thousands of Los Angeles residents are experiencing right now. Total losses from the wildfires’ first week alone are estimated to exceed $250 billion.

How insurance could break the economy

This state of affairs isn’t just dangerous for homeowners and communities — it could create widespread financial instability. And it’s not just me making this point. For the past several years, central bankers at home and abroad have raised similar concerns. So let’s talk about the risks of large-scale financial contagion.

Anyone who remembers the Great Recession of 2007-2009 knows that seemingly localized problems can snowball.

In that event, the value of opaque bundles of real estate derivatives collapsed from artificial and unsustainable highs, leaving millions of mortgages around the U.S. “underwater.” These properties were no longer valued above owners’ mortgage liabilities, so their best choice was simply to walk away from the obligation to make their monthly payments.

Lenders were forced to foreclose, often at an enormous loss, and the collapse of real estate markets across the U.S. created a global recession that affected financial stability around the world.

Forewarned by that experience, the U.S. Federal Reserve Board wrote in 2020 that “features of climate change can also increase financial system vulnerabilities.” The central bank noted that uncertainty and disagreement about climate risks can lead to sudden declines in asset values, leaving people and businesses vulnerable.

At that time, the Fed had a specific climate-based example of a not-implausible contagion in mind – global risks from sudden large increases in global sea level rise over something like 20 years. A collapse of the West Antarctic Ice Sheet could create such an event, and coastlines around the world would not have enough time to adapt.

In a 2020 press conference, Federal Reserve Chair Jerome Powell discusses climate change and financial stability.

The Fed now has another scenario to consider – one that’s not hypothetical.

It recently put U.S. banks through “stress tests” to gauge their vulnerability to climate risks. In these exercises, the Fed asked member banks to respond to hypothetical but not-implausible climate-based contagion scenarios that would threaten the stability of the entire system.

We will now see if the plans borne of those stress tests can work in the face of enormous wildfires burning throughout an urban area that’s also a financial, cultural and entertainment center of the world.

About the Author:

Gary W. Yohe, Huffington Foundation Professor of Economics and Environmental Studies, Wesleyan University

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

Economics & Fundamentals Opinions

22 Jan

Knowing less about AI makes people more open to having it in their lives – new research

By Chiara Longoni, Bocconi University; Gil Appel, George Washington University, and Stephanie Tully, University of Southern California

The rapid spread of artificial intelligence has people wondering: who’s most likely to embrace AI in their daily lives? Many assume it’s the tech-savvy – those who understand how AI works – who are most eager to adopt it.

Surprisingly, our new research (published in the Journal of Marketing) finds the opposite. People with less knowledge about AI are actually more open to using the technology. We call this difference in adoption propensity the “lower literacy-higher receptivity” link.

This link shows up across different groups, settings and even countries. For instance, our analysis of data from market research company Ipsos spanning 27 countries reveals that people in nations with lower average AI literacy are more receptive towards AI adoption than those in nations with higher literacy.

Similarly, our survey of US undergraduate students finds that those with less understanding of AI are more likely to indicate using it for tasks like academic assignments.

The reason behind this link lies in how AI now performs tasks we once thought only humans could do. When AI creates a piece of art, writes a heartfelt response or plays a musical instrument, it can feel almost magical – like it’s crossing into human territory.

Of course, AI doesn’t actually possess human qualities. A chatbot might generate an empathetic response, but it doesn’t feel empathy. People with more technical knowledge about AI understand this.

They know how algorithms (sets of mathematical rules used by computers to carry out particular tasks), training data (used to improve how an AI system works) and computational models operate. This makes the technology less mysterious.

On the other hand, those with less understanding may see AI as magical and awe inspiring. We suggest this sense of magic makes them more open to using AI tools.

Our studies show this lower literacy-higher receptivity link is strongest for using AI tools in areas people associate with human traits, like providing emotional support or counselling. When it comes to tasks that don’t evoke the same sense of human-like qualities – such as analysing test results – the pattern flips. People with higher AI literacy are more receptive to these uses because they focus on AI’s efficiency, rather than any “magical” qualities.

It’s not about capability, fear or ethics

Interestingly, this link between lower literacy and higher receptivity persists even though people with lower AI literacy are more likely to view AI as less capable, less ethical, and even a bit scary. Their openness to AI seems to stem from their sense of wonder about what it can do, despite these perceived drawbacks.

This finding offers new insights into why people respond so differently to emerging technologies. Some studies suggest consumers favour new tech, a phenomenon called “algorithm appreciation”, while others show scepticism, or “algorithm aversion”. Our research points to perceptions of AI’s “magicalness” as a key factor shaping these reactions.

These insights pose a challenge for policymakers and educators. Efforts to boost AI literacy might unintentionally dampen people’s enthusiasm for using AI by making it seem less magical. This creates a tricky balance between helping people understand AI and keeping them open to its adoption.

To make the most of AI’s potential, businesses, educators and policymakers need to strike this balance. By understanding how perceptions of “magicalness” shape people’s openness to AI, we can help develop and deploy new AI-based products and services that take the way people view AI into account, and help them understand the benefits and risks of AI.

And ideally, this will happen without causing a loss of the awe that inspires many people to embrace this new technology.

About the Author:

Chiara Longoni, Associate Professor, Marketing and Social Science, Bocconi University; Gil Appel, Assistant Professor of Marketing, School of Business, George Washington University, and Stephanie Tully, Associate Professor of Marketing, USC Marshall School of Business, University of Southern California

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

Opinions Programming

21 Jan

5 Stocks Ideas from December & January including 3 Tech Companies

By InvestMacro Research

The first quarter of 2025 is underway and we wanted to highlight some of the companies that have been recently added to our Cosmic Rays Watchlist. The Cosmic Rays Watchlist is the output from our proprietary fundamental analysis algorithm and these companies made the list in the last 30 days.

The algo examines company fundamental metrics, earnings trends and overall sector strength trends. The aim is identify quality dividend-paying companies on the NYSE and Nasdaq stock exchanges. If a company scores over 50, it gets added to our Watchlist for further analysis.

We use this system as a stock market ideas generator and to update our Watchlist every quarter. However, be aware the fundamental system does not take the stock price as a direct element in our rating so one must compare each idea with their current stock prices (this is not a timing tool).

Many studies are consistently showing overvalued markets at the current time and that has to be taken into consideration with any stock market idea. As with all investment ideas, past performance does not guarantee future results. A stock added to our list is not a recommendation to buy or sell the security.

Here we go with 5 of our Top Stocks scored in December 2024 & so far in January 2025:

Micron Technology, Inc.
Conagra Brands, Inc.
TD SYNNEX Corporation
Science Applications International Corporation
Wipro Limited

Micron Technology, Inc. (MU):

Micron Technology, Inc. (Symbol: MU) was recently added to our Cosmic Rays WatchList. MU scored a 62 in our fundamental rating system in late December 2024.

At time of writing, only 4.77% of stocks have scored a 60 or better out of a total of 10,772 scores in our earnings database. This stock is on our Watchlist for the first time and rose by 77 system points from our last update.

MU is a Large Cap stock and part of the Technology sector. The industry focus for MU is Semiconductors.

MU has beat earnings expectations four consecutive quarters and has a dividend of 0.43 percent with a payout ratio near just 7 percent. The MU stock price has outperformed the Technology Sector benchmark over the past 52 weeks by a small margin with a gain of nearly +26.00 percent.

Company Description (courtesy of SEC.gov):

Micron Technology, Inc. designs, manufactures, and sells memory and storage products worldwide. The company operates through four segments: Compute and Networking Business Unit, Mobile Business Unit, Storage Business Unit, and Embedded Business Unit. It provides memory and storage technologies comprises DRAM products, which are dynamic random access memory semiconductor devices with low latency that provide high-speed data retrieval.

Company Website: https://www.micron.com

Asset vs Sector Benchmark: *P/E Ratio (TTM) *52-Week Price Return *Beta (S&P500)
– Stock: Micron Technology, Inc. (MU) 31.3 25.92 1.18
– Benchmark Symbol: XLK 38.2 22.75 1.2

* Data through January 21, 2025

Conagra Brands, Inc. (CAG):

Conagra Brands, Inc. (Symbol: CAG) was recently added to our Cosmic Rays WatchList. CAG scored a 64 in our fundamental rating system in December 2024.

At time of writing, only 4.77% of stocks have scored a 60 or better out of a total of 10,772 scores in our earnings database. This stock has made our Watchlist a total of 4 times and rose by 23 system points from our last update.

CAG is a Large Cap stock and part of the Consumer Defensive sector. The industry focus for CAG is Packaged Foods.

CAG has beat earnings expectations in three out of the past four quarters and has a dividend of 5.42 percent with a payout ratio around 68 percent. The CAG stock price has under-performed the Consumer Defensive Sector benchmark over the past 52 weeks and has fallen by -10.74 percent compared with the benchmark gain of +6.91 percent.

Company Description (courtesy of SEC.gov):

Conagra Brands, Inc., together with its subsidiaries, operates as a consumer packaged goods food company in North America. The company operates in four segments: Grocery & Snacks, Refrigerated & Frozen, International, and Foodservice.

Company Website: https://www.conagrabrands.com

Asset vs Sector Benchmark: *P/E Ratio (TTM) *52-Week Price Return *Beta (S&P500)
– Stock: Conagra Brands, Inc. (CAG) 25.0 -10.74 0.33
– Benchmark Symbol: XLP 22.7 6.91 0.6

* Data through January 21, 2025

TD SYNNEX Corporation (SNX):

TD SYNNEX Corporation (Symbol: SNX) was recently added to our Cosmic Rays WatchList. SNX scored a 65 in our fundamental rating system on January 13, 2025.

SNX is a Large Cap stock and part of the Technology sector. The industry focus for SNX is Technology Distributors.

SNX has beat earnings expectations two quarters in a row and in three out of the past four quarters. SNX sports a dividend of 1.28 percent with a payout ratio around 24 percent. The SNX stock price has beaten the Technology Sector benchmark over the past 52 weeks and has risen by 32.81 percent compared with the benchmark gain of +22.75 percent.

Company Description (courtesy of SEC.gov):

TD SYNNEX Corporation provides business process services in the United States and internationally. The company distributes PC systems, mobile phones and accessories, printers, peripherals, supplies, endpoint technology software, consumer electronics, information technology (IT) systems including data center server and storage solutions, system components, software, networking, communications and security equipment, technology software, and converged and hyper-converged infrastructure, as well as computing components.

Company Website: https://www.tdsynnex.com

Asset vs Sector Benchmark: *P/E Ratio (TTM) *52-Week Price Return *Beta (S&P500)
– Stock: TD SYNNEX Corporation (SNX) 17.7 32.81 1.4
– Benchmark Symbol: XLK 38.2 22.75 1.2

* Data through January 21, 2025

Science Applications International Corporation (SAIC):

Science Applications International Corporation (Symbol: SAIC) was recently added to our Cosmic Rays WatchList. SAIC scored a 50 in our fundamental rating system in December 2024.

At time of writing, only 8.20% of stocks have scored a 50 or better out of a total of 10,772 scores in our earnings database. This stock is on our Watchlist for the first time and rose by 46 system points from our last update.

SAIC is a Medium Cap stock and part of the Technology sector. The industry focus for SAIC is Information Technology Services.

SAIC has beat earnings expectations two quarters in a row and gives out a dividend of 1.28 percent with a payout ratio around 16 percent. The SAIC stock price has under-performed the Technology Sector benchmark over the past 52 weeks with a shortfall of -8.2 percent compared with the benchmark gain of +22.75 percent.

Company Description (courtesy of SEC.gov):

Science Applications International Corporation provides technical, engineering, and enterprise information technology (IT) services primarily in the United States. The company’s offerings include engineering; technology integration; IT modernization; maintenance of ground and maritime systems; logistics; training and simulation; operation and program support services; and end-to-end services, such as design, development, integration, deployment,

Company Website: https://www.saic.com

Asset vs Sector Benchmark: *P/E Ratio (TTM) *52-Week Price Return *Beta (S&P500)
– Stock: Science Applications International Corporation (SAIC) 20.2 -8.2 0.69
– Benchmark Symbol: XLK 38.2 22.75 1.2

* Data through January 21, 2025

Wipro Limited (WIT):

Wipro Limited (Symbol: WIT) was recently added to our Cosmic Rays WatchList. WIT scored a 53 in our fundamental rating system on January 21, 2025.

WIT is a Large Cap stock and part of the Technology sector. The industry focus for WIT is Information Technology Services.

WIT has beat earnings expectations in two out of the past fur quarters and met expectations in the others. WIT gives out a dividend of 2.02 percent with a payout ratio around 30 percent. The WIT stock price has slightly under-performed the Technology Sector benchmark over the past 52 weeks with a gain of 20.7 percent compared with the benchmark gain of +22.75 percent.

Company Description (courtesy of SEC.gov):

Wipro Limited operates as information technology (IT), consulting, and business process services company worldwide. It operates through three segments: IT Services, IT Products, and India State Run Enterprise Services (ISRE). The IT Services segment offers IT and IT-enabled services, including digital strategy advisory, customer-centric design, technology and IT consulting, custom application design, development, re-engineering and maintenance, s

Company Website: https://www.wipro.com

Asset vs Sector Benchmark: *P/E Ratio (TTM) *52-Week Price Return *Beta (S&P500)
– Stock: Wipro Limited (WIT) 27.1 20.7 0.71
– Benchmark Symbol: XLK 38.2 22.75 1.2

* Data through January 21, 2025

By InvestMacro – Be sure to join our stock market newsletter to get our updates and to see more top companies we add to our stock watch list.

All information, stock ideas and opinions on this website are for general informational purposes only and do not constitute investment advice. Stock scores are a data driven process through company fundamentals and are not a recommendation to buy or sell a security. Company descriptions provided by sec.gov.

Risk Disclosure: Stock Market trading and trading on margin carries a high level of risk and can result in loss of part or all of your investment. Due to the level of risk and market volatility, Stock Market trading may not be suitable for all investors and you should not invest money you cannot afford to lose. Before deciding to invest in the stock market, you should carefully consider your investment objectives, level of experience, and risk appetite. You should be aware of all the risks associated with stock market trading, and seek advice from an independent financial advisor should you have any doubts.

Opinions Stock Market Ideas Stock Market News

19 Jan

Speculators continue to raise US Dollar Index Bets into 2025

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 January 14th 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 Canadian Dollar & US Dollar Index

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

Leading the gains for the currency markets was the Canadian Dollar (11,436 contracts) with the US Dollar Index (4,084 contracts), the EuroFX (3,727 contracts), the New Zealand Dollar (2,535 contracts) and Bitcoin (145 contracts) also showing positive weeks.

The currencies seeing declines in speculator bets on the week were the British Pound (-14,068 contracts), the Japanese Yen (-9,222 contracts), the Australian Dollar (-4,198 contracts), the Mexican Peso (-6,394 contracts), the Brazilian Real (-1,897 contracts) and the Swiss Franc (-813 contracts) also registering lower bets on the week.

Speculators continue to raise US Dollar Index Bets into 2025

Highlighting the COT currency’s data this week is the increase in the speculator’s positioning for the US Dollar Index that’s carried over from December into the new year. The large speculative US Dollar Index positions rose this week by over 4,000+ contracts and have now gained for five consecutive weeks. This recent rise in speculator sentiment has been carried over each week from December 17th to January 14th for a total +15,953 net contract boost over the 5-week period.

This has pushed the overall bullish speculator position above the +10,000 contract threshold for the first time since September 10th. The Dollar Index bets, previously, had spent a total of seven weeks in October, November and early December in bearish or negative contract territory before finally turning around in mid-December.

The Dollar Index futures price (DX) was slightly lower to close this week but overall the trend has been higher for the DX. Since the last short-term bottom on the weekly charts in September – the DX has advanced by over 9 percent and broken through previous resistance areas from 107.50 to 109.00. Currently, the Dollar Index price is sitting right around the 109.40 level with the weekly RSI signaling a slightly overbought level of 70.10.

Currencies Net Speculators Leaderboard

Legend: Weekly Speculators Change | Speculators Current Net Position | Speculators Strength Score compared to last 3-Years (0-100 range)

Strength Scores led by Bitcoin & Japanese Yen

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 (80 percent) and the Japanese Yen (62 percent) lead the currency markets this week.

On the downside, the New Zealand Dollar (3 percent), the EuroFX (6 percent), the Canadian Dollar (13 percent) and the Brazilian Real (19 percent) come in at the lowest strength levels currently and are in Extreme-Bearish territory (below 20 percent).

3-Year Strength Statistics:
US Dollar Index (33.1 percent) vs US Dollar Index previous week (24.6 percent)
EuroFX (5.8 percent) vs EuroFX previous week (4.4 percent)
British Pound Sterling (36.3 percent) vs British Pound Sterling previous week (42.6 percent)
Japanese Yen (61.9 percent) vs Japanese Yen previous week (65.6 percent)
Swiss Franc (22.5 percent) vs Swiss Franc previous week (24.1 percent)
Canadian Dollar (13.0 percent) vs Canadian Dollar previous week (7.9 percent)
Australian Dollar (21.2 percent) vs Australian Dollar previous week (24.2 percent)
New Zealand Dollar (3.0 percent) vs New Zealand Dollar previous week (0.0 percent)
Mexican Peso (31.8 percent) vs Mexican Peso previous week (35.1 percent)
Brazilian Real (19.0 percent) vs Brazilian Real previous week (20.8 percent)
Bitcoin (80.4 percent) vs Bitcoin previous week (77.3 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 (64 percent) and the US Dollar Index (33 percent) lead the past six weeks trends for the currencies.

The Australian Dollar (-70 percent) leads the downside trend scores currently with the New Zealand Dollar (-34 percent), Brazilian Real (-17 percent) and the Japanese Yen (-13 percent) following next with lower trend scores.

3-Year Strength Trends:
US Dollar Index (32.7 percent) vs US Dollar Index previous week (23.7 percent)
EuroFX (-1.1 percent) vs EuroFX previous week (-3.1 percent)
British Pound Sterling (-8.5 percent) vs British Pound Sterling previous week (-3.2 percent)
Japanese Yen (-12.7 percent) vs Japanese Yen previous week (1.0 percent)
Swiss Franc (4.8 percent) vs Swiss Franc previous week (3.6 percent)
Canadian Dollar (-3.5 percent) vs Canadian Dollar previous week (-11.0 percent)
Australian Dollar (-70.3 percent) vs Australian Dollar previous week (-74.6 percent)
New Zealand Dollar (-33.7 percent) vs New Zealand Dollar previous week (-35.4 percent)
Mexican Peso (0.9 percent) vs Mexican Peso previous week (4.6 percent)
Brazilian Real (-16.6 percent) vs Brazilian Real previous week (-24.1 percent)
Bitcoin (63.9 percent) vs Bitcoin previous week (52.1 percent)

Individual COT Forex Markets:

US Dollar Index Futures:

The US Dollar Index large speculator standing this week resulted in a net position of 12,729 contracts in the data reported through Tuesday. This was a weekly lift of 4,084 contracts from the previous week which had a total of 8,645 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 33.1 percent. The commercials are Bullish with a score of 65.9 percent and the small traders (not shown in chart) are Bearish with a score of 39.7 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend.

US DOLLAR INDEX Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	64.5	24.0	8.8
– Percent of Open Interest Shorts:	36.7	55.2	5.4
– Net Position:	12,729	-14,288	1,559
– Gross Longs:	29,512	10,978	4,033
– Gross Shorts:	16,783	25,266	2,474
– Long to Short Ratio:	1.8 to 1	0.4 to 1	1.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	33.1	65.9	39.7
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	32.7	-31.7	3.2

Euro Currency Futures:

The Euro Currency large speculator standing this week resulted in a net position of -60,397 contracts in the data reported through Tuesday. This was a weekly advance of 3,727 contracts from the previous week which had a total of -64,124 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 5.8 percent. The commercials are Bullish-Extreme with a score of 97.7 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 0.0 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend.

EURO Currency Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	26.9	56.4	12.0
– Percent of Open Interest Shorts:	36.9	48.4	10.0
– Net Position:	-60,397	48,337	12,060
– Gross Longs:	162,760	341,025	72,682
– Gross Shorts:	223,157	292,688	60,622
– Long to Short Ratio:	0.7 to 1	1.2 to 1	1.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	5.8	97.7	0.0
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-1.1	4.7	-24.4

British Pound Sterling Futures:

The British Pound Sterling large speculator standing this week resulted in a net position of 438 contracts in the data reported through Tuesday. This was a weekly reduction of -14,068 contracts from the previous week which had a total of 14,506 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 36.3 percent. The commercials are Bullish with a score of 67.3 percent and the small traders (not shown in chart) are Bearish with a score of 29.8 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend.

BRITISH POUND Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	40.1	47.0	10.9
– Percent of Open Interest Shorts:	39.9	39.5	18.5
– Net Position:	438	14,985	-15,423
– Gross Longs:	80,557	94,313	21,817
– Gross Shorts:	80,119	79,328	37,240
– Long to Short Ratio:	1.0 to 1	1.2 to 1	0.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	36.3	67.3	29.8
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-8.5	9.5	-10.7

Japanese Yen Futures:

The Japanese Yen large speculator standing this week resulted in a net position of -29,411 contracts in the data reported through Tuesday. This was a weekly decrease of -9,222 contracts from the previous week which had a total of -20,189 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 61.9 percent. The commercials are Bearish with a score of 39.9 percent and the small traders (not shown in chart) are Bullish with a score of 59.8 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend.

JAPANESE YEN Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	40.8	39.3	18.0
– Percent of Open Interest Shorts:	54.0	25.5	18.7
– Net Position:	-29,411	31,023	-1,612
– Gross Longs:	91,434	88,113	40,268
– Gross Shorts:	120,845	57,090	41,880
– Long to Short Ratio:	0.8 to 1	1.5 to 1	1.0 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	61.9	39.9	59.8
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-12.7	11.5	1.4

Swiss Franc Futures:

The Swiss Franc large speculator standing this week resulted in a net position of -38,701 contracts in the data reported through Tuesday. This was a weekly decline of -813 contracts from the previous week which had a total of -37,888 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 22.5 percent. The commercials are Bullish-Extreme with a score of 91.3 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 4.0 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend.

SWISS FRANC Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	8.0	83.7	7.8
– Percent of Open Interest Shorts:	49.2	23.8	26.5
– Net Position:	-38,701	56,343	-17,642
– Gross Longs:	7,557	78,690	7,316
– Gross Shorts:	46,258	22,347	24,958
– Long to Short Ratio:	0.2 to 1	3.5 to 1	0.3 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	22.5	91.3	4.0
– Strength Index Reading (3 Year Range):	Bearish	Bullish-Extreme	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	4.8	4.9	-22.8

Canadian Dollar Futures:

The Canadian Dollar large speculator standing this week resulted in a net position of -167,153 contracts in the data reported through Tuesday. This was a weekly lift of 11,436 contracts from the previous week which had a total of -178,589 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 13.0 percent. The commercials are Bullish-Extreme with a score of 90.8 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 0.1 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend.

CANADIAN DOLLAR Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	6.6	83.6	7.9
– Percent of Open Interest Shorts:	54.3	31.8	11.9
– Net Position:	-167,153	181,481	-14,328
– Gross Longs:	23,031	292,957	27,533
– Gross Shorts:	190,184	111,476	41,861
– Long to Short Ratio:	0.1 to 1	2.6 to 1	0.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	13.0	90.8	0.1
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-3.5	6.6	-21.6

Australian Dollar Futures:

The Australian Dollar large speculator standing this week resulted in a net position of -77,631 contracts in the data reported through Tuesday. This was a weekly decline of -4,198 contracts from the previous week which had a total of -73,433 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 21.2 percent. The commercials are Bullish-Extreme with a score of 82.0 percent and the small traders (not shown in chart) are Bearish with a score of 23.6 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend.

AUSTRALIAN DOLLAR Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	13.6	69.9	12.1
– Percent of Open Interest Shorts:	54.0	24.4	17.2
– Net Position:	-77,631	87,297	-9,666
– Gross Longs:	26,135	134,239	23,314
– Gross Shorts:	103,766	46,942	32,980
– Long to Short Ratio:	0.3 to 1	2.9 to 1	0.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	21.2	82.0	23.6
– Strength Index Reading (3 Year Range):	Bearish	Bullish-Extreme	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-70.3	65.3	-27.8

New Zealand Dollar Futures:

The New Zealand Dollar large speculator standing this week resulted in a net position of -52,089 contracts in the data reported through Tuesday. This was a weekly advance of 2,535 contracts from the previous week which had a total of -54,624 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 3.0 percent. The commercials are Bullish-Extreme with a score of 97.2 percent and the small traders (not shown in chart) are Bearish with a score of 20.9 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend.

NEW ZEALAND DOLLAR Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	11.9	83.8	3.9
– Percent of Open Interest Shorts:	68.4	24.4	6.7
– Net Position:	-52,089	54,644	-2,555
– Gross Longs:	10,921	77,144	3,632
– Gross Shorts:	63,010	22,500	6,187
– Long to Short Ratio:	0.2 to 1	3.4 to 1	0.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	3.0	97.2	20.9
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-33.7	33.1	-1.7

Mexican Peso Futures:

The Mexican Peso large speculator standing this week resulted in a net position of 5,997 contracts in the data reported through Tuesday. This was a weekly reduction of -6,394 contracts from the previous week which had a total of 12,391 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 31.8 percent. The commercials are Bullish with a score of 72.3 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 10.3 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend.

MEXICAN PESO Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	40.0	54.5	2.7
– Percent of Open Interest Shorts:	35.8	57.1	4.2
– Net Position:	5,997	-3,765	-2,232
– Gross Longs:	57,188	77,842	3,823
– Gross Shorts:	51,191	81,607	6,055
– Long to Short Ratio:	1.1 to 1	1.0 to 1	0.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	31.8	72.3	10.3
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	0.9	-1.0	0.6

Brazilian Real Futures:

The Brazilian Real large speculator standing this week resulted in a net position of -34,874 contracts in the data reported through Tuesday. This was a weekly reduction of -1,897 contracts from the previous week which had a total of -32,977 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 19.0 percent. The commercials are Bullish-Extreme with a score of 83.0 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 14.1 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend.

BRAZIL REAL Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	26.1	68.0	2.8
– Percent of Open Interest Shorts:	71.8	20.7	4.3
– Net Position:	-34,874	36,067	-1,193
– Gross Longs:	19,951	51,899	2,111
– Gross Shorts:	54,825	15,832	3,304
– Long to Short Ratio:	0.4 to 1	3.3 to 1	0.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	19.0	83.0	14.1
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-16.6	16.3	0.2

Bitcoin Futures:

The Bitcoin large speculator standing this week resulted in a net position of 1,335 contracts in the data reported through Tuesday. This was a weekly gain of 145 contracts from the previous week which had a total of 1,190 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 80.4 percent. The commercials are Bearish with a score of 25.5 percent and the small traders (not shown in chart) are Bearish with a score of 24.0 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend.

BITCOIN Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	81.7	3.7	3.7
– Percent of Open Interest Shorts:	77.9	8.0	3.2
– Net Position:	1,335	-1,520	185
– Gross Longs:	28,966	1,330	1,304
– Gross Shorts:	27,631	2,850	1,119
– Long to Short Ratio:	1.0 to 1	0.5 to 1	1.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	80.4	25.5	24.0
– Strength Index Reading (3 Year Range):	Bullish-Extreme	Bearish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	63.9	-63.9	-27.4

Article By InvestMacro – Receive our weekly COT Newsletter

COT Updates Forex and Currency News Opinions

19 Jan

Speculator Extremes: Live Cattle, Coffee, NZD & Euro lead Bullish & Bearish Positions

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 January 14th.

Here Are This Week’s Most Bullish Speculator Positions:

Live Cattle

The Live Cattle speculator position comes in as the most bullish extreme standing this week. The Live Cattle 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 25.3 this week. The overall net speculator position was a total of 123,285 net contracts this week with a gain of 4,740 contract in the weekly 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.

Coffee

The Coffee speculator position comes next in the extreme standings this week. The Coffee speculator level is now at a 96.7 percent score of its 3-year range.

The six-week trend for the percent strength score was 5.8 this week. The speculator position registered 72,642 net contracts this week with a weekly rise by 8,508 contracts in speculator bets.

Steel

The Steel speculator position comes in third this week in the extreme standings. The Steel speculator level resides at a 88.0 percent score of its 3-year range.

The six-week trend for the speculator strength score came in at -0.7 this week. The overall speculator position was -2,183 net contracts this week with an edge higher by 414 contracts in the weekly speculator bets.

Lean Hogs

The Lean Hogs speculator position comes up number four in the extreme standings this week. The Lean Hogs speculator level is at a 87.0 percent score of its 3-year range.

The six-week trend for the speculator strength score totaled a change of -11.7 this week. The overall speculator position was 76,542 net contracts this week with an increase by 3,797 contracts in the speculator bets.

Gold

The Gold speculator position rounds out the top five in this week’s bullish extreme standings. The Gold speculator level sits at a 86.3 percent score of its 3-year range. The six-week trend for the speculator strength score was 7.5 this week.

The speculator position was 279,363 net contracts this week with a rise of 24,452 contracts in the weekly speculator bets.

This Week’s Most Bearish Speculator Positions:

New Zealand Dollar

The New Zealand Dollar speculator position comes in as the most bearish extreme standing this week. The New Zealand Dollar speculator level is at a 3.0 percent score of its 3-year range.

The six-week trend for the speculator strength score was -33.7 this week. The overall speculator position was -52,089 net contracts this week with an increase of 2,535 contracts in the speculator bets.

Euro

The Euro speculator position comes in next for the most bearish extreme standing on the week. The Euro speculator level is at a 5.8 percent score of its 3-year range.

The six-week trend for the speculator strength score was -1.1 this week. The speculator position was -60,397 net contracts this week with a move up by 3,727 contracts in the weekly speculator bets.

Sugar

The Sugar speculator position comes in as third most bearish extreme standing of the week. The Sugar speculator level resides at a 6.4 percent score of its 3-year range.

The six-week trend for the speculator strength score was -26.1 this week. The overall speculator position was 14,162 net contracts this week with a drop of -35,665 contracts in the speculator bets.

Cotton

The Cotton speculator position comes in as this week’s fourth most bearish extreme standing. The Cotton speculator level is at a 7.0 percent score of its 3-year range.

The six-week trend for the speculator strength score was -14.9 this week. The speculator position was -35,741 net contracts this week with a decline by -3,657 contracts in the weekly speculator bets.

5-Year Bond

Finally, the 5-Year Bond speculator position comes in as the fifth most bearish extreme standing for this week. The 5-Year Bond speculator level is at a 10.9 percent score of its 3-year range.

The six-week trend for the speculator strength score was 4.4 this week. The speculator position was -1,777,621 net contracts this week with a boost of 23,282 contracts in the weekly speculator bets.

Article By InvestMacro – Receive our weekly COT Newsletter

COT Updates Opinions Soft Commodities

17 Jan

Gold-to-CPI Ratio Hits New All-Time High

Source: John Newell (1/15/25)

John Newell of John Newell & Associates takes a look at the gold-to-CPI ration as it hits new highs and examines what this means for inflation and living costs.

The Gold-to-CPI ratio, a key indicator of gold’s purchasing power relative to inflation, has recently reached a new all-time high.

This milestone reflects gold’s enduring role as a hedge against inflation, but it also serves as a reminder of the complex forces driving rising costs in today’s economy.

What Is the Gold-to-CPI Ratio?

The Gold-to-CPI ratio measures the price of gold divided by the Consumer Price Index (CPI), a common metric for tracking the cost of goods and services.

A rising ratio indicates that gold’s purchasing power is increasing faster than inflation, making it a strong hedge against rising costs.

Historically, this ratio has spiked during periods of economic turmoil, such as the late 1970s when inflation ran rampant, reaching levels that rival today’s economic challenges.

Understanding Inflation: Why Prices Rise

Inflation occurs when the purchasing power of money decreases, causing the price of goods and services to rise. One key driver is the overprinting of currency by governments. When too much money enters circulation, the supply of money outpaces economic productivity, eroding its value. This scenario often leads to higher prices for everyday necessities, from food to housing.

For example, during the COVID-19 pandemic, massive stimulus programs flooded economies with liquidity to prevent economic collapse. While these measures helped stave off immediate crises, they also contributed to inflationary pressures as demand surged while supply chains struggled to keep up.

Natural Disasters and Inflation: The Hidden Costs

Inflation isn’t just driven by monetary policy; natural disasters can also play a significant role in pushing up the cost of living. Take the recent fires in California as an example. Such disasters disrupt supply chains, destroy housing stock, and reduce agricultural output, driving up prices for basic necessities like food, housing, and energy.

In California, the destruction of homes and infrastructure has increased demand for materials and labor, pushing construction costs higher. Agricultural losses from fires have also reduced the availability of crops, causing food prices to spike. These localized inflationary pressures can ripple through the broader economy, compounding the challenges faced by households.

Gold as a Safe Haven

As inflation erodes the value of fiat currencies, gold’s appeal grows. Its status as a store of value is particularly evident during times of uncertainty when economic instability or geopolitical turmoil drives investors to seek safety.

The current high in the gold-to-CPI ratio underscores this trend, reflecting gold’s ability to outpace inflation and preserve wealth.

Looking Ahead

The Gold-to-CPI ratio reaching a new peak signals more than just the strength of gold; it highlights the broader economic forces shaping our lives.

From government policy to natural disasters, a range of factors are driving inflation and reshaping the global economy. For investors, this underscores the importance of diversifying portfolios and considering assets like gold to protect against the ongoing erosion of purchasing power.

Important Disclosures:

Statements and opinions expressed are the opinions of the author and not of Streetwise Reports, Street Smart, or their officers. The author is wholly responsible for the accuracy of the statements. Streetwise Reports was not paid by the author to publish or syndicate this article. Streetwise Reports requires contributing authors to disclose any shareholdings in, or economic relationships with, companies that they write about. Any disclosures from the author can be found below. Streetwise Reports relies upon the authors to accurately provide this information and Streetwise Reports has no means of verifying its accuracy.
This article does not constitute investment advice and is not a solicitation for any investment. Streetwise Reports does not render general or specific investment advice and the information on Streetwise Reports should not be considered a recommendation to buy or sell any security. Each reader is encouraged to consult with his or her personal financial adviser and perform their own comprehensive investment research. By opening this page, each reader accepts and agrees to Streetwise Reports’ terms of use and full legal disclaimer. Streetwise Reports does not endorse or recommend the business, products, services or securities of any company.

For additional disclosures, please click here.

John Newell Disclaimer

As always it is important to note that investing in precious metals like silver carries risks, and market conditions can change violently with shock and awe tactics, that we have seen over the past 20 years. Before making any investment decisions, it’s advisable consult with a financial advisor if needed. Also the practice of conducting thorough research and to consider your investment goals and risk tolerance.

Metals Opinions

17 Jan

Soaring wealth inequality has remade the map of American prosperity

By Tom Kemeny, University of Toronto

One need only glance at headlines about Jeff Bezos, Elon Musk and other super-wealthy individuals to understand that wealth in America is increasingly concentrated in fewer and fewer hands. Inequality is sharply on the rise.

Until now, however, little has been known about where the richest households are located, which cities are the most unequal and how these trends have evolved.

In a new analysis I conducted with my colleagues, we reveal where wealth is most concentrated within and between communities, cities and states. The result is GEOWEALTH-US – the first data that tracks the geography of wealth in the United States and how it has changed since 1960.

The overall picture is worrying. The wealthiest cities in the U.S. are now almost seven times richer than the poorest regions, a disparity that has almost doubled since 1960. Meanwhile, especially in urban coastal areas, wealth has become highly concentrated in the hands of a few. The picture from the geography of wealth suggests we are even more divided than we thought.

Mapping inequality

To measure wealth locally, we built precise models of household wealth, applying sophisticated machine learning techniques to data from the Federal Reserve’s survey of consumer finances.

We then used the models to estimate wealth among households in the decennial census and American community survey, where we can identify where people live.

Experts define wealth as the difference between the value of a household’s assets – cash, real estate and stocks, for example – and its liabilities, including mortgages, student loans and credit card debt. Wealth is also called “net worth.”

Using GEOWEALTH-US, we show that the wealth distribution across the U.S. has transformed since 1960. Inequality between the nation’s flourishing urban centers and other areas of the country, especially in parts of the South and Midwest, is higher than it has ever been over the previous 60 years.

The expansion of wealth inequality is a challenge to the American Dream: the notion that, with hard work, opportunity and prosperity are accessible to all.

Wealth enables choice and stability. Poorer households have more trouble providing the best nutrition and education for their children. Additionally, people growing up in lower-wealth households are less likely to spur innovation in a field or start successful new businesses. Wealth also profoundly affects one’s health, leaving the least wealthy in our society significantly more vulnerable to premature death and disability.

Large wealth gaps between places

We analyzed average household wealth across the U.S. between 1960 and 2022, using census-defined communities of about 100,000 residents.

At the community level, the lack of wealth can make a major difference in how well cities work for their residents.

People who grow up in wealthier places can reap benefits that span generations. As a result of property taxes and philanthropy, wealthier communities have greater resources for schools, health care, transportation and other infrastructure.

Good schools are one benefit of wealthy communities that may improve social mobility even for children born into poverty, studies suggest.

The map for 2022 reveals major disparities in typical (median) net worth across communities. Many of the least wealthy locations are in poor neighborhoods in some of America’s biggest cities – for instance, parts of the Bronx and East Harlem in New York, and areas of Houston and Milwaukee. A typical household in the five poorest communities had assets worth about $18,000. Many households in these locations held more debt than assets. Other wealth-poor areas of the country included parts of Baton Rouge, Louisiana, and Cincinnati, Ohio.

The wealthiest communities today tend to be found in urban coastal areas.

Palo Alto, California, and Nassau County, New York, are two of the nation’s five wealthiest places. The top five areas had median household net worth of nearly $1.7 million. That’s almost 90 times wealthier than the poorest five places.

These wealth divides help explain why, between 2019 and 2021, according to the school finance indicators database, the Palo Alto Unified School District in California spent about $7,000 more per student than the minimum required to achieve national benchmark test scores. Meanwhile, the East Baton Rouge school district spent almost $4,000 less per student than is required to meet those same national standards. Cincinnati Public Schools underspent by more than $9,000 per pupil.

Large wealth gaps within places

We also looked at wealth divides in cities and communities. Average wealth levels in a community matter, but so does their unequal distribution.

Inequality, especially when a community is racially diverse and spatially segregated, has been linked to underinvestment in public goods such as schools, roads and hospitals.

Our research identified large gaps in wealth within communities.

For example, in certain parts of California such as San Jose and Santa Monica, we found that the richest 10% of residents are about seven times wealthier than the median household. In contrast, in many parts of Utah and Minnesota, the wealthiest 10% of households are only about three times wealthier than the median household.

Coastal areas, then, are not simply wealthier than the rest of the country; wealth in these places is also less equally shared.

We also found that wealth is unequally distributed across many parts of the South. This reflects the legacy of slavery, discrimination and uneven economic development over generations.

Regardless of geography, across America we found that the most unequal places were likely to have larger populations of African Americans, Hispanics and other people of color. In these locations, white households were overrepresented among the wealthiest. Households of color, meanwhile, generally had much lower net worth.

The map of wealth is changing

Extensive testing shows that our model estimates wealth with a high level of accuracy. And by mapping household wealth rather than household income, which is what researchers more commonly use to assess economic well-being, we found that place-based divides are much worse than previously believed.

Our data shows that wealth gaps between places have grown much more than income gaps since 1960. By 2020, gaps in average wealth levels were about 60% higher than equivalent income gaps.

This appears to be driven by the changing economic fortunes of cities.

Average wealth levels in the San Francisco Bay Area, Seattle, New York and Boston have risen dramatically as these areas have cemented their leadership in high-technology sectors and finance.

The loss of manufacturing jobs, meanwhile, destroyed wealth in many American communities. In 1960, the industrial hub of Cleveland, Ohio, had among the highest levels of average household wealth in the country, according to our data. In 2020, Cleveland ranked 466th out of the 722 areas in our study.

Within cities, we also observed a rise in wealth concentration. In the Minneapolis metropolitan area, for instance, the share of total wealth held by the richest 0.1% of households has almost tripled, from about 3% in 1960 to almost 9% by 2020. This means that, compared with the past, just a few families there now own a much larger piece of the pie.

Ladder to success becoming harder to climb

Multiple factors may explain the growing pooling of wealth. They include the rising concentration of high-paying jobs in major metro areas and the explosive growth in housing values in these high-performing cities.

Changing federal tax policies have also favored the affluent at the expense of regular Americans.

If such policies continue under the next Trump administration, the divided geography of wealth may well grow worse – with significant consequences for U.S. democracy.

About the Author:

Tom Kemeny, Associate Professor, Munk School of Global Affairs & Public Policy, University of Toronto

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

Economics & Fundamentals Opinions

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All information and opinions on this website are for general informational purposes only and do not constitute investment advice.

Asset vs Sector Benchmark:	*P/E Ratio (TTM)	*52-Week Price Return	*Beta (S&P500)
– Stock: Micron Technology, Inc. (MU)	31.3	25.92	1.18
– Benchmark Symbol: XLK	38.2	22.75	1.2