Commitments of Traders
Speculators added 9K new long positions and 12.7K new short positions this week. They were 89K net long, which is the lowest since they became net long back in September 2017. It’s worth to note that the Open Interest grew significantly. This week the total open interest was at 576K positions. The highest open interest ever recorded in this market was 608K positions in March this year. This is when the EURUSD topped and collapsed by 1000 pips in three months. Rising open interest on lower prices supports the current downtrend. If we get over 600K, we might start looking at other reversal/extreme signals but for now, sell on rallies is a preferred strategy in the long term
Speculators added 2.5K new longs and 4.7K new shorts this week. They were 23K net short. This is the most net short they have been since 2016. Looking at the rising price action off the support at 0.7450, we see that speculators are getting caught on the wrong side of the market. The price rallies while they are selling AUD Futures. This is one mixed outlook but I am in favour of higher prices in AUDUSD. I expect speculators to catch up very quickly and add more bullish pressure to the price action.
This week speculators added 6.6K new long positions and 12K ( twice as many ) short positions. They were almost 110K net long. This is down from 115K in the previous week and 120K two weeks ago. They are clearly dumping longs and adding a lot of short positions recently. Net positions trend below 33 weeks moving average and the current downturn remains supported by smart money.
This week speculators piled on JPY longs adding 13K of them. They also added 4K of the short positions. This made them 3.6K net long for this week. This is the most net long since they became net long back in March this year. It is clearly changed sentiment from the previous two weeks when they were net bearish with 5.4K positions in the red. It seems like speculators are getting bullish on JPY ( This is USDJPY bearish )
Speculators covered a lot of their long positions recently. This week they closed out whooping 22.3K longs and it the last 3 weeks they covered 51K long contracts. This accounts for almost half of the total. They held 113K longs 4 weeks ago. This is one very bearish signal for GBP for now. This week speculators were 9K net long, down from 26K in the previous week. 33 moving average of net positions comes in 17K so this market is officially in the downtrend.
This week we saw more bearish confirmation and more signals to suggest that the EURUSD rally might be ending. This week speculators dumped a massive 21K longs and only 1K shorts.Covered longs accounted for almost 10% of all speculative longs. All closed in one week. This is hugely bearish signal. Other metrics reported in the previous week were suggesting the top is now in place. As this needs a little bit more confirmation. The warning must be issued. This looks to me like EURUSD has topped and the downtrend is very likely.
This week speculators were bullish again.This time they added 2.4K fresh longs and covered 1.5K of their short positions. This made them 151K net long, which is up from 147K in the previous week and ALL TIME HIGH. My analysis is getting clearer every week. All metrics suggests that EURUSD rally we have seen in the last few months might be finally come to the end or at least the price might stage some major correction to the downside.
Speculators continue to be CAD bearish ( USDCAD bullish ) for a 3rd week in a row. This time they took some profits off the table. They covered 1.5K longs and 1.7K shorts. They were 31K net short, unchanged form the previous week. They clearly want to be CAD short. It is a fairly rare occurrence when the speculators find themselves on the wrong side of the trade. In this case, the price of USDCAD is dropping significantly while the speculators hold the other side of this transaction. It will be interesting to see what side will eventually prevails. In my view, the speculators will. It means the current downtrend in USDCAD is likely to fade soon?
Speculators took profits but they showed a strong bullish bias again. This week they covered both long and short positions but they closed out almost 3 times more shorts ( 9.7K ) than longs ( 3.5K). They were 40.3K net long. This is the highest level of net longs since 2014. The extreme level at that time reached 40K net long when the price collapsed from 1.71. We still have more room to go so the bias remains to the upside in the long term.
This week speculators turned from being net short back to be net long, exactly as I expected it to happen. This was next step in the pattern development I track. They added 15K new longs and dropped 3.3K shorts. This trade made them 18K net long, from being 779 contracts net short in the previous week.
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