Speculators' Short USD Position Up Again - Commitment of Traders (COT) Technical Analysis


CashBackForex Representative
COT (Commitment of Traders) COT Report, 25 September 2012. Once again the speculators combined net short position in the USD climbed higher. It is now up to 267,878 total contracts in the currencies and the DI tabulated below. The only remaining USD long position was versus the euro. There remain short euro positions of 66,908 contracts against a long USD but this is down almost 200K contracts from the high short position.

Currency specs added to their long commodity currency positions. They are now long a total of 263,140 contracts of the Canadian, Australian and New Zealand Dollar. This was up from 239,375 contracts in the previous week.

In recent weeks the British Pound has become another favourite of the specs. Going back to the COT report from August 14th, specs were short 9,608 contracts of the Pound. They have since reversed their position and are now up to a long of over 52K contracts. During this period there has been a big interest in the total open interest, and it has continued to climb after the cut-off date of the latest report.

US Dollar Index: The DI is a market that has been dominated by the large trader and hedge fund operators. In the latest report, they flipped to the short side of the market. Only a month ago the specs were long over 42K contracts, and they are now short 4.2K. This is the first time specs have been short the DI contracts since the report of August 30th, 2011.
Euro (EUR/USD): Speculators continue to liquidate their short positions in the euro, this week taking it 28K contracts lower. While the small spec is short only 9K contracts, the large spec remains a 2 to 1 short. The total short in the euro is down to 66.9K contracts. Spreading is quite large, 11.0 of the total open interest reflecting a very active option trade.
British Pound Sterling (GBP/USD): The OI was up by 11% as the specs continued to add to their long in the pound. The total spec long is up over 52K contracts, with the small specs better than a 2 ratio long. Spreading is very light, indicative of small interest in pound options.
Japanese Yen (JPY/USD): The disagreement between the large and small specs in the yen continues. Large specs are long the yen by about 21K contracts and the small specs are short by about 11K. With the yen meandering sideways within a fairly narrow range, there are so far no winners in this one.
Swiss Franc (CHF/USD): Small specs are now short the SF, while the large specs remain a minor short. This means the total spec position combined net position is now 4.4K contracts long. As a consequence of the net position by the large specs approaching even as they reduced their shorts, the commercial flipped to the short side of the SF.
Canadian Dollar (CAD/USD): The specs affection for the long side of the C$ continues. Small specs are a 2.5 ratio long, and the large specs are a 7.5 ratio long. The total long spec position in the C$ is 137,730 contracts.
New Zealand Dollar (NZD/USD): Specs continue to buy the kiwi, resulting in a 10% increase in the open interest for the week. Large specs are a 6.85 to 1 long, and the small specs are a 3 ratio long. The spec long position is 87.4% of the OI and their short are only 15.8%.
Australian Dollar (AUD/USD): The large specs in the A$ covered 18.1K contracts of their shorts which took their net long up to almost 90K and a 4.4 ratio longs to shorts. Small specs are only modest longs, but the two combined groups were just short of 102K long.


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