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- Nov, 16 Speculative USD Short Positions Remain High
- Oct, 30 Australian Dollar Speculative Longs Remain Extreme
- Oct, 23 Speculative Canadian Dollar Longs Indicate Extreme
- Oct, 16 Swiss Franc Long Positions Highest Since December 2004 (COT)
- Sep, 30 Large Speculators are Too Short US Dollars
Speculators have started covering US dollar short positions and selling Euro, AUD, NZD, CAD, and CHF long positions. The evidence is US dollar bullish.
Latest CFTC Release Dated November 03, 2009:
The COT Index is the percentile of the difference between net speculative positioning and net commercial positioning measured over a specific number of weeks (either 52 or 13). A reading close to 0 suggests that a bottom is forming and a reading close to 100 suggests that a top is forming. The readings are for the actual currency, not the currency pair. For example, a reading of 100 on the Canadian Dollar suggests that the Canadian Dollar is close to a top (USDCAD close to a bottom).
Readings of 95 and higher as well as 5 and lower are in boldfaced red type to indicate potential market extremes. For example, an increasing index is bullish until the index is extreme (near 100), at which time the risk of a reversal or pause in the trend increases
US Dollar
Speculators (red) have started to cover US dollar short positions (see the red line turning up). This warns of a trend change towards US dollar strength.
Euro
The analysis is the exact opposite of the US dollar analysis. Speculators (red line) have started to exit long positions after being extremely long at the peak.
British Pound
British Pound positioning has been violent. Specualtors were extremely short several weeks ago, which led to a massive short covering rally. The current positions of specs and commercials sheds little light on the situation.
Australian Dollar
Australian dollar positioning and its implications is similar to that of the Euro.
New Zealand Dollar
New Zealand dollar positioning and its implications is similar to that of the Euro and Australian dollars.
Japanese Yen
Japanese Yen positioning does not offer any insight at this time.
Canadian Dollar
Canadain dollar positioning and its implications is similar to that of the Euro, Australian and New Zealand dollars (suggests a topping out of CAD, bottoming of USDCAD).
Swiss Franc
Swiss Franc positioning and its implications is similar to that of the Euro, Australian, New Zealand and Canadain dollars (suggests a topping out of CHF, bottoming of USDCHF).
Jamie Saettele publishes Daily Technicals every weekday morning, COT analysis (published Friday evenings), technical analysis of currency crosses on Monday, Wednesday, and Friday (Euro and Yen crosses), and intraday trading strategy as market action dictates. He is the author of Sentiment in the Forex Market. Follow his intraday market commentary and trades at DailyFX Forex Stream. Send requests to receive his reports via email to jsaettele@dailyfx.com.
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