Data from this past week’s CFTC Commitment of Trader’s Report (COT) shows leveraged money traders have an overall short position in the Canadian dollar for the first time in a year.
Data from this past week’s CFTC Commitment of Trader’s Report shows leveraged money traders have an overall short position in the market for the Canadian dollars for the first time in a year.
The Commodity Futures Trading Commission’s Commitments of Traders (COT) report shows long positions in the Canadian dollar have been exhausted and the market is now positioned short on the CAD. Net Noncommercial Positions on the IMM stand on the short side of the CAD by 9011 contracts versus last week’s bullish positioning of 10429. The last time the COT showed the market was positioned against the CAD was in August of 2010 when the USD/CAD traded as high as 1.6050. This Friday the pair closed at 0.9869.
An analysis of the open interest also displays some interesting points. We can see that the open interest has fallen dramatically to 87905, the lowest level of contracts open since early July. This tells us that the recent rise in the price of the USD/CAD may be due to shorts covering their positions and is a bearish indicator (for the Canadian dollar).
Given the flip in market positioning of leveraged traders to being short the CAD as well as a subsequent drop-off in open interest, I’m skeptical of the long term trend downtrend resuming in the near term.
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