IFC Markets - Analytics

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    Investors increase slightly bullish bets on USD

    According to the report of the Commodity Futures Trading Commission (CFTC) covering data up to July 28, the value of US dollar net long position edged up to $29.8 billion from $29.77 billion in the previous week. Economic reports during the week provided indication of strengthening housing market as existing home sales further grew in June at 5.49 million annual rate after increasing at 5.32 million annual rate the previous month. The new home sales meanwhile fell 6.8% in June to an annual rate of 482 thousand. Durable goods orders excluding transportation posted better-than-expected 0.8% rise in June, while durable goods orders including volatile aircraft orders rose 3.4%. Manufacturing and services sectors also expanded in July according to Markit’s preliminary PMIs. Initial jobless claims fell unexpectedly for the week to 255 thousand. On this backdrop the fall in Conference Board’s index of consumer confidence to 90.9 in June from 100.1 in the previous month was unexpected. At the same time Dallas Fed’s manufacturing index fell in June, indicating contraction as a result of falling energy prices. Evidently, from investors’ perspective, the positive developments outweighed negative surprises on the margin, and investors increased dollar bullish bets ahead of Fed’s two day policy meeting on July 28-29. As is evident from the Sentiment table, the sentiment deteriorated for all major currencies except for Euro and British Pound.

    The euro sentiment improved markedly. The net short bets in euro narrowed $1.06bn to $14.4bn, with euro’s share falling to 48% of long US dollar position. The euro net short position rose as investors increased gross longs and covered shorts.

    The Japanese yen sentiment continued to deteriorate at a slower pace with net short position widening $0.14bn to $6.4bn as investors cut both gross shorts and gross longs. The Japanese yen still has the second highest short bets against US dollar, making up 21.5% of aggregate US dollar long position. The British pound net short bets narrowed $1.1bn to $0.96bn with investors increasing gross longs and covering shorts.

    The sentiment toward the Canadian dollar deteriorated at a faster pace with net short position widening $0.97bn to $4.3bn. Investors cut gross longs and increased gross short positions. The Australian dollar net short bets continued to deteriorate and widened by $0.68bn to $3.7bn as investors cut gross longs and increased gross shorts. A sizable reduction in Swiss franc net longs to the tune of $0.4 billion in the light of previous moderate weekly changes has reduced the net long position of the only currency still held long against the US dollar to just $16 million. Investors cut gross longs and increased gross shorts.

    commitment of traders

    commitment of traders net long short

    commitment of traders weekly change

    market sentiment ratio long short positions

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