By CountingPips.com
The latest Commitments of Traders (COT) report, released on Friday by the Commodity Futures Trading Commission (CFTC), showed that large futures speculators added to their short positions of the euro and British pound sterling against the US dollar last week while bets on the Canadian dollar and the Mexican peso also turned bearish. Non-commercial futures speculative contracts, positions usually taken by hedge funds and large traders, decreased their long positions in the Swiss franc, Australian dollar and the New Zealand dollar directly against the US dollar while increasing bearish bets for the euro, British pound sterling, Canadian dollar and the Mexican peso, according to data on September 13th. Japanese yen positions were the only currency against the US dollar that rose last week.
Last week saw a continuation of risk aversion in traders positions as the euro debt crisis has prompted a selloff of riskier assets and increased buying of the US dollar and Japanese yen. Reuters reports that the September 13th CFTC data marks the first time since July 2010 that speculators are now long the dollar (by $1.77 billion in contract value) against the other major currencies.
EuroFX: Currency speculators continued to decrease their futures positions for the euro against the U.S. dollar to the lowest level since June 2010. Euro positions dipped as of September 13th to a total of 54,459 net short contracts from the previous week’s total of 36,443 net short contracts on September 6th. Euro positions have fallen below the previous low level for the year on January 11th when net contracts were on the short side by 45,182 and are at the lowest level since being short by 73,670 contracts on June 29, 2010.
The COT report is published every Friday by the Commodity Futures Trading Commission (CFTC) 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 betting that currency to fall against the dollar and net long position expect that currency to rise versus the dollar. The graphs overlay the forex spot closing price of each Tuesday when COT trader positions are reported for each corresponding spot currency pair.
GBP: British pound sterling positions declined for a third consecutive week as speculators remained bearish on the pound sterling. Pound positions decreased to a total of 26,193 short positions as on September 13th following a total of 13,220 short positions as of September 6th.
JPY: The Japanese yen net contracts rose slightly as of September 13th after declining for three consecutive weeks. Yen net long positions edged higher to a total of 34,955 net long contracts reported on September 13th following a total of 32,787 net long contracts reported on September 6th.
CHF: Swiss franc long positions declined for a third consecutive week as of September 13th. Speculators decreased bets on Swiss currency futures to a total of 5,493 net long contracts following a total of 7,549 net long contracts as of September 6th. The Swiss currency, usually a popular safe haven currency, has been stuck in neutral since the Swiss National Bank implemented a policy to fight the appreciation of the franc and maintain pegged against the euro at the 1.20 level.
CAD: Canadian dollar positions decreased for a second consecutive week and fell to the lowest level all year as speculators turned bearish on the loonie. CAD net contracts declined to a total of 6,303 net short contracts as of September 13th following a decline to a total of 2,081 net long contracts on September 6th. This the first time the Canadian dollar positions have been on the short side since June 28th when contracts were short by 1,863.
AUD: The Australian dollar long positions declined as of September 13th after rising for four consecutive weeks. AUD futures positions fell to a total net amount of 36,934 long contracts following a total of 48,041 net long contracts reported as of September 6th.
NZD: New Zealand dollar futures positions were virtually unchanged compared to the previous week on September 13th. NZD contracts edged slightly lower to a total of 17,664 net long contracts following a total of 17,670 net long contracts registered on September 6th.
MXN: Mexican peso contracts continued lower, declining for a sixth straight week and falling over to the short side. Peso positions declined to a total of 1,209 net short speculative positions as of September 13th following a total of 13,246 long contracts that were reported as of September 6th and marking the lowest peso level in at least a year.
COT Data Summary as of September 13, 2011
Large Speculators Net Positions vs. the US Dollar
EUR -54459
GBP -26193
JPY +34955
CHF +5493
CAD -6303
AUD +36934
NZD +17664
MXN -1209
