Currency Specs Big Buyers of the USD


CashBackForex Representative
CFTC Commitments of Traders (COT) Report 03 September, published 06 September 2013, Technical Analysis. For the past three weeks the currency specs had been reducing their USD longs. This changed this past week when they increased their USD long to 304,975 contracts, up from last week's 254,645 contracts.

The biggest shift in positions was in the euro where specs reduced their euro longs from 34.6K to 11.2K. Also, there was about a 10K increase in the yen and the C$ shorts. The biggest open interest is now in the euro - 324K - and the yen and the A$, both at 217K.

Trade in the pound continues to be baffling. Large specs are stubborn shorts and increased their short this week to 49.6K. Yesterday (Monday) morning, the pound forged a new high, and is now trading at levels not seen since mid-June. How much more will these specs take?

US Dollar Index: The OI went down in the latest week but the total spec long in the DI went up to 19.7K. The OI was down because the large spec reduced both his long and his short. The total net spec long increased because the small spec increased his long positions and reduced his shorts. The small spec is a 5.5 ratio long.

Euro (EUR/USD): There is a difference of opinion between the large specs, who are long the euro, and the small specs who are short. Both spec groups reduced their long position taking the combined net spec long in the euro down to 11.2. Last week the long was 34.6. Spreading remains quite large, 18.6% of the total OI of 324K.

British Pound Sterling (GBP/USD): Large spec continue to carry the short pound position despite it not working. The total spec short in the pound increased to 49.7, up from 45.4. Small specs are likewise short the pound. The pound made a three-month high earlier yesterday.

Japanese Yen (JPY/USD): Again, specs increased their short position in the yen, taking the total short up to 109.4K. Large specs are about a 3.9 ratio short, and the small specs re about a 2.4 short. Spreading is now over 10% of the market.

Swiss Franc (CHF/USD): There was little change in this small market with a skight decress in the OI, and a small decrease in the total SF long position. Both small and large specs have nominal long SF positions. On Friday last, the US and Canadian employment reports hurt the C$ shorts.

Canadian Dollar (CAD/USD): The OI was up 10.4K as the large specs increased their C$ short. The total spec short is now 47.9K, up from 40.5K last week. The large spec is now better than a 2 ratio short.

New Zealand Dollar (NZD/USD): Large speculators flipped to the short side of this mini market last week. They joined the small specs who had gone short the kiwi in the previous week.

Australian Dollar (AUD/USD): There has been little movement of positions in this period. Specs remain massive shorts, 90.1K, down very little from last week. Large specs are a 7 ratio short. Trade after the end of the cut off date for this report has damaged the shorts equity.
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