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The latest data for the weekly Commitment of Traders (COT) report, released by the Commodity Futures Trading Commission (CFTC) on Friday, showed that large traders and speculators continued to increase their bullish bets for the US Dollar Index while sharply betting against the European common currency again this week.
The non-commercial futures contracts of US Dollar Index futures, traded by large speculators and hedge funds, totaled a net position of 37,876 contracts in the data reported through Tuesday October 16th. This was a weekly boost of 167 contracts from the previous week which had a total of 37,709 net contracts.
The speculative sentiment has continued it bullishness for the Dollar Index as bullish bets have risen for three straight weeks and for twenty-four weeks out of the past twenty-six.
An aggregate measure of the US dollar position – the total of US dollar contracts against the combined contracts of the euro, British pound, Japanese yen, Australian dollar, Canadian dollar and the Swiss franc – slid to an overall US dollar position totaling $27.64 billion as of Tuesday October 16th, according to the latest data from the CFTC and dollar amount calculations by Reuters. This was a weekly decline of $-0.15 billion from the $27.79 billion total position that was registered the previous week, according to the Reuters calculation.
The aggregate dollar position fell for the first time in five weeks but remains above the +$27 billion threshold for a second straight week. The aggregate position has continued to be in a bullish position for eighteen consecutive weeks now dating back to June 19th.
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In the individual currency contracts data, we saw three substantial changes (+ or – 10,000 contracts) in the speculators category this week.
Euro bets dropped sharply this week by over -13,000 contracts and have now fallen for three straight weeks. The euro standing is at the most bearish level since March 7th of 2017 (-41,027 net contracts)
British pound positions jumped this week by over +10,000 contracts and rose for the third week out of the past four. The overall speculative standing remains highly bearish but the GBP position has improved or become less bearish by nearly 30,000 contracts since September 18th
Japanese yen positions rebounded by over +14,000 contracts this week following a dismal showing over the previous six weeks. The JPY position had fallen by a total of -69,160 over those previous six weeks. The current standing remains above -100,000 net contracts for a third week.
New Zealand “kiwi” dollar speculator bearish bets rose again this week (-1,592 weekly change in contracts) for a second straight week. The speculator positions are at a new record high bearish level (data going back to 1999) at above -35,000 net contracts.
Overall, the major currencies that improved this week were the US Dollar Index (167 weekly change in contracts), British pound sterling (10,154 contracts), Japanese yen (14,580 contracts), Canadian dollar (1,126 contracts) and the Australian dollar (1,793 contracts).
The currencies whose speculative bets declined this week were the euro (-13,202 weekly change in contracts), Swiss franc (-3,721 contracts), New Zealand dollar (-1,592 contracts) and the Mexican peso (-5,874 contracts).
See the table and individual currency charts below.
Table of Weekly Commercial Traders and Speculators Levels & Changes:
| Currency | Net Commercials | Comms Weekly Chg | Net Speculators | Specs Weekly Chg |
| EuroFx | 11,913 | 17,351 | -29,344 | -13,202 |
| GBP | 66,401 | -9,684 | -50,353 | 10,154 |
| JPY | 119,621 | -18,581 | -100,621 | 14,580 |
| CHF | 30,951 | 3,236 | -16,524 | -3,721 |
| CAD | 6,874 | -1,329 | -11,019 | 1,126 |
| AUD | 92,905 | -964 | -71,491 | 1,793 |
| NZD | 40,201 | 2,159 | -35,412 | -1,592 |
| MXN | -72,928 | 5,881 | 68,575 | -5,874 |
This latest COT data is through Tuesday and shows a quick view of how large speculators or non-commercials (for-profit traders) as well as the commercial traders (hedgers & traders for business purposes) 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 dollar will gain versus the euro.
*COT Report: The weekly commitment of traders report summarizes the total trader positions for open contracts in the futures trading 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). Find CFTC criteria here: (http://www.cftc.gov/MarketReports/CommitmentsofTraders/ExplanatoryNotes/index.htm).
The Commitment of Traders report is published every Friday by the Commodity Futures Trading Commission (CFTC) and shows futures positions data that was reported as of the previous Tuesday (3 days behind).
Each currency contract is a quote for that currency directly against the U.S. dollar, a net short amount of contracts means that more speculators are betting that currency to fall against the dollar and a net long position expect that currency to rise versus the dollar.
(The charts overlay the forex closing price of each Tuesday when COT trader positions are reported for each corresponding spot currency pair.) See more information and explanation on the weekly COT report from the CFTC website.
Article by CountingPips.com
