Originally published by AxiTrader
The latest positioning report from the CFTC showed that large speculators were forced to cut their US dollar short positions further. While market participants do not seem to believe in the sustainability of the dollar rally, it has become difficult for US dollar bears to hold their positions as the euro has tumbled back below 1.17 and USD/JPY jumped above 110.
Euro net positioning has decreased from 120k to 115k long. Given the large decline in the euro, positioning remains at an elevated level. However, considering the poor economic data out of the Euro Zone in recent weeks and concerns around Italy, it will get increasingly difficult for euro bulls to remain optimistic.
Meanwhile, pound net positioning fell from 9k to 6k long.
Yen net positioning turned from short to long, and currently stands at 4k (vs. -5k previously). This shows that speculators are anticipating a risk-off environment in the short-term, despite the improvement in market sentiment last week, along with the break above 110 in USD/JPY.
In the commodity currencies, there were some notable changes as well:
- Australian dollar short positioning increased by 6k to 23k net short
- Canadian dollar positioning remain unchanged at 24k net short
- New Zealand dollar net positioning stood at 2k long, a decrease of 11k compared to the previous week
