Commitments of Traders
EUR Futures: Speculators made only a minor adjustments to their positions. They covered 1.1K long positions and only 627 short positions. They were 106K net shrt, which is considered an extreme level. Shar of open interest is also high ( 50.1% ). The same outlook remains valid: Expect this market to bottom and reverse to the upside fairly soon
Speculators buy GBP despite a negative sentiment around Brexit. This week they added 8.5K fresh long positions and 11K shorts. They were 1.8K net short, this is after being NET LONG in the previous week. Overall, speculators have been steadily buying GBP futures in the recent week. If the trend continues, they will be solid net long in 2-3 weeks. It will be time to load up on GBP longs.
After adding fresh 24K shorts two weeks ago, speculators took some profits last week. They covered 4.5K long positions and only 1.5K shorts. They were 102K new short. This is yet another consecutive week with higher net positions in this market. Historically, we are looking at 120K as an ultimate low. There is still some room for more shorts but at this point EUR market is getting seriously oversold
No much change to the bullish sentiment has been present in this market in the last few weeks. Speculators added 5.7K new longs and 7.1K new shorts to their portfolios. They were 10K new short, slightly changed from being 8.5K in the previous week. This is treated as bullish to me as the speculative positions are trending above 33 weeks moving averages. GBP will surprise the market to the upside, watch it!
Speculators, after taking profits last week were rather bearish. They covered 2K of their long positions and added fresh 570 shorts. These adjustments are only small. Speculators were 80K net short, which was up from being 77K in the previous week. Speculators have been becoming more bearish every week and this week’s volume is the largest they were net short since January 2017
There was a major shift in the speculative positions for GBP Futures. This week speculators left their long positions unchanged by covered a significant volume ( 22.7K ) of their short positions. This account for 35% reduction of short exposure and signifies long bias from the smart money. Speculators were 13K net short, down from being 36K net short in the previous week. These two signals confirm my bias outlook for GBPUSD. We are likely to see higher GBP prices, despite the Brexit drama.
Speculators took profits this week. They covered 4.5K of their long positions and 3K of their shorts. They were 37K net short, which was up from being 35K in the previous week. Given the bad press around GBP, it seems like the smart money is not afraid and not expecting anything unusual.
This is the first view into speculative positions for many weeks. CFTC finally caught up with the backlog. This week speculators loaded up on both sides of the trade. They added 12K new long positions and 17.7K new short positions. They were 78K net short, which is highest since Christmas 2016. Although this seems extreme, the shorts still have a room to grow. The last extreme levels we saw counted in 245K short positions and the net positions turned at around 130K.
High open interest suggest overcrowded market and there might be a reversal looming as there is no many traders willing to transact. Every time Open Interest reached high levels, EURUSD bottomed or topped and reversed, giving a beginning of a new long term trend. It worth mentioning that the extreme level of net positions always accompanied the reversals in the past. This is not the case now ( not yet anyway). I would expect the open interest to keep climbing while net positions will reach extreme level sometimes early next year. If these two variables line up, we could see EURUSD bottoming up and reversing to the upside.
Speculators have been rather bearish in the last 2 weeks. They covered 8K of their long positions and this is after they covered another 4.2K in the week before. At the same time, they kept their longs unchanged. They were 55K net short, which is up from being 47K in the previous week and 37K in the week before that. Clearly , speculators are becoming more bearish in EUR futures.It’s too early to call these levels extreme.
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