It was another CFTC reporting week that saw little adjustment to the speculative positioning in the euro, yen, and sterling futures. In fact, the average change in the gross speculative positions in these three major currencies was 2.7k contracts. Another sign that speculators tread water in the major currencies was that the 3.6k contract reduction of the speculative gross short Swiss franc position was larger than the gross position changes in the other majors.
However, it was different among the dollar-bloc currency futures. There speculators added to gross long positions. The bulls added 7.0k contracts to lift the gross long Canadian dollar position to 53.2k contracts. The bulls added 1.7k New Zealand dollar futures contracts. The speculators' gross long position now stands at 36.6k contracts. The biggest change among the currency futures we track was the 12.8k-contract increase in the gross long Australian dollar futures to 79.3k contracts.
Of note, the bears in the dollar-bloc currency futures also saw opportunity. The bears added less than one thousand contracts to the gross short New Zealand dollar position (to 33.3k) and 5.3k contracts to the gross short Australian dollar position (to 55.1k). The Canadian dollar was the exception, as the bears covered 3.8k contracts, leaving them with 33.8k gross short futures contracts.
These adjustment to the gross positions produced larger net long positions. The speculative net long Canadian dollar position more than doubled to 19.3k contracts (from 8.6k). It is the largest since last September. The net long Aussie position increased by 50% to 24.2k contracts (from 16.7k), as did the net Kiwi position (2.9k from 1.8k).
In the US 10-year Treasury note futures, both bulls and bears saw opportunity. The bulls added 53.4k contracts to lift the speculators' gross long position to 525.8k contracts. The bears were not outdone. They added 90.4k contracts to the gross short position, which now stands 867,3k contracts. The result of these gross adjustments was to increase the net short position to 341.5k contracts from 304.6k the previous reporting week.
The bulls continue to dominate in the oil futures. Speculators added 21.3k contracts to their gross long position. They have done so for five consecutive weeks. The speculative gross long position stands at 683.3k contracts. The bears covered another 10.1k contracts to reduce the gross short position to 174.8k contracts. The net position rose 31.5k contracts to 508.5k.
Opinions expressed are solely of the author’s, based on current market conditions, and are subject to change without notice. These opinions are not intended to predict or guarantee the future performance of any currencies or markets. This material is for informational purposes only and should not be construed as research or as investment, legal or tax advice, nor should it be considered information sufficient upon which to base an investment decision. Further, this communication should not be deemed as a recommendation to invest or not to invest in any country or to undertake any specific position or transaction in any currency. There are risks associated with foreign currency investing, including but not limited to the use of leverage, which may accelerate the velocity of potential losses. Foreign currencies are subject to rapid price fluctuations due to adverse political, social and economic developments. These risks are greater for currencies in emerging markets than for those in more developed countries. Foreign currency transactions may not be suitable for all investors, depending on their financial sophistication and investment objectives. You should seek the services of an appropriate professional in connection with such matters. The information contained herein has been obtained from sources believed to be reliable, but is not necessarily complete in its accuracy and cannot be guaranteed.
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