Gonçalo Moreira, CMT
Independent Analyst
The latest data for the weekly Commitments of Traders (COT) report, released by the Commodity Futures Trading Commission (CFTC) on Friday the 10th, showed weekly shortfalls on the large non-commercial net positions for the Euro and Swiss franc against the US dollar. Weekly advances, in turn, were seen in the Japanese yen, British pound, New Zealand dollar, and Australian dollar, albeit all very modest. These advance against the US dollar might intensify in this week's report with NFP data already priced in.
In net negative net territory remain the A$ with large speculators adding new short positions, and the Yen which escaped from the low of -143.822 net positioning two weeks ago to remain less negative at -128.868. Biggest speculative positions are still held in the yen with open interest above 230.000 contracts.
Large speculators seem to reverse their sell positions in the Japanese yen liquidating short contracts. This liquidation could be forced if USD/JPY slips to new lows this week .
The euro spiked in December with a lower ratio between longs and shorts compared to the CoT data coincident with its October peak, and also with less long contracts than in October. This divergence seen between EUR/USD price and the CoT Oscillator, as seen in the above illustration, could be a warning to traders who are emotionally or materially attached to an upside continuation in the major pair.
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