USD longs fell back, EUR shorts plunged - Rabobank

Analysts at Rabobank lists down the IMM net speculators’ positioning as at 14 March, 2017.

Key Quotes

“Having lurched higher the previous week, USD longs fell back ahead of the March FOMC meeting. The lack of hawkish commentary from the FOMC suggest that longs are likely to slip further in the next set of data.”

“EUR shorts plunged following the March ECB meeting on speculation that the ECB could be prepared to hike rates before its QE programme expires. The result of the Dutch election could further pressure shorts which are now at their lowest levels since May 2016.”

“JPY shorts surged last week ahead of the BoJ policy meeting. Speculation of stealth BoJ tapering and concerns about further exchange rate rhetoric from the US ahead of the Japan-US talks next month could limit upside potential for shorts.”

“Bearish bets against the pound have soared as the start of the Brexit process approaches. There is now no legal obstacle to prevent PM May from triggering Article 50 of the Lisbon Treaty. This will initiate the start of what could be a period of difficult negotiations between the UK and the EU.”

“CHF shorts edged a little lower for a second week potentially on the back of some reduction in tensions ahead of the French Presidential election.”

“CAD longs dropped last week as oil prices came under pressure. The better tone of Canadian economic data, however, should offer some support. AUD long positions also fell. In the spot market the AUD had lost the upside momentum noted earlier in the year though it spiked higher vs. the USD after the Fed meeting last week.”