By CountingPips.com
The latest Commitments of Traders (COT) data out on Friday showed that futures speculators continued to decrease their bets for the U.S. dollar against the euro as of July 13th, according to the COT data released by the Chicago Mercantile Exchange. Non-commercial futures positions, those taken by hedge funds and large speculators, were net short the euro against the U.S. dollar by -27,050 contracts after being net short the euro by -38,909 contracts the week 
before on July 6th. short positions have now fallen for two straight weeks and are just a month removed from being short by -111,945, showing the change of sentiment for the euro.
The COT report is published every Friday by the Chicago Mercantile Exchange (CME) and shows futures positions as of the previous Tuesday. It can be a useful tool for traders to gauge investor sentiment and to look for potential changes in the direction of a currency or commodity. Each currency contract is a quote for that currency directly against the U.S. dollar, where as a net short amount of contracts means that more speculators are expecting that currency to fall against the dollar and net longs expect that currency to rise versus the dollar.
The British pound sterling was the only other major currency in addition to the euro that was net short in the CME futures market against the dollar as of July 13th while the Australian dollar, New Zealand dollar, Japanese yen, Swiss franc, Canadian dollar and Mexican peso all had a net long amount of contracts against the dollar.
The British pound net shorts decreased to -34,671 from a total of -38,077 that were reported net short on July 6th. The Swiss franc positions turned to net long last week by 14,590 contracts after registering -7,455 net short positions the week before. This was the first time since January 26th that the Swiss franc positions have been net long.
The Japanese yen net long contracts continued to advance higher to 47,359 as of July 13th following 37,926 net long contracts on July 6th. Investors have increased their yen positions for five straight weeks and have reversed their yen positions substantially from being short by 65,612 contracts on May 4th.
The Australian dollar futures positions were net long by 23,480 contracts as of July 13th, rising higher after totaling a net 7,246 long contracts on July 6th. The New Zealand dollar futures positions also rose higher on the long side with 5,452 long contracts this week after a total of 2,577 long contracts as of July 6th.
The Canadian dollar long positions rose to net 22,038 contracts and after 8,094 net longs the week before while the Mexican peso long contracts advanced to 28,135 longs from 22,725 longs the prior week.
COT Data Summary (vs. the US Dollar) as of July 13th, 2010
Australian dollar net longs increase to 23,480 contracts from 7,246
British pound sterling futures contracts were net short by -34,671 from -38,077
Canadian dollar net long contracts rose to 22,038 from 8,094
Euro net short positions declined to -27,050 from -38,909
Japanese yen net longs up to 47,359 from 37,926
New Zealand dollar longs increased to 5,452 from net long of 2,577
Mexican peso long contracts increased to 28,135 from 22,725
Swiss franc net long contracts are at 14,590 from -7,455
