Forex positioning and data in the futures market for the close of trading on Tuesday, October 4, 2016
the following are the net speculative positions in the major currencies as of the close of business on Tuesday October 4, 2016
- EUR 82K short versus 76K short last week. Shorts increased by 6K.
- GBP 98K short versus 88K short last week. Shorts increased by 10K
- JPY 69K long versus 69K long last week. Unchanged.
- CHF 3K short versus 6K short last week. Shorts pared by 3K.
- CAD 14K short versus 12K short last week. Shorts increased by 2K
- AUD 24K long versus 15K long last week. Longs increased by 9K.
- NZD 8K short versus 7K short last week. Shorts increased by 1K
The big mover is the GBP which saw shorts increase by 10K in the current week. The short of 98K was the largest short position on record. Those shorts are feeling better today.
In addition the US dollar total "bets" are the highest since August 9th.
The weekly commitment of traders report outlines the speculative positions for each currency as of the close of business on Tuesday of the reporting week. As such, it is a snapshot of the past, not the present.
Traders like to use the net speculative positions to gauge interest, or perhaps even oversold or overbought market conditions.
For example if the positions are at a record short, the speculators are confident about the position. However. given a catalyst that might lead to the currency moving in the opposite direction of the position, the momentum could lead to a snap back move on the back of covering.