Skip to Content
News & Analysis at your fingertips.

We use a range of cookies to give you the best possible browsing experience. By continuing to use this website, you agree to our use of cookies.
You can learn more about our cookie policy here, or by following the link at the bottom of any page on our site. See our updated Privacy Policy here.

0

Notifications

Notifications below are based on filters which can be adjusted via Economic and Webinar Calendar pages.

Live Webinar

Live Webinar Events

0

Economic Calendar

Economic Calendar Events

0
Free Trading Guides
Subscribe
Please try again
More View More
US Dollar Bears Slowing Down, GBP/USD Flips to Net Short - COT Report

US Dollar Bears Slowing Down, GBP/USD Flips to Net Short - COT Report

Justin McQueen,

US Dollar, GBP/USD, USD/JPY, COT Report –Analysis

  • US Dollar Bearish Positioning Slows Down
  • GBP/USD Flips Net Short for the First Time Since December
  • Investors Constructive on Safe-Haven Japanese Yen and Swiss Franc

The Predictive Power of the COT Report

How to Read the CFTC Report

Source: CFTC, DailyFX (Covers up to Apr 21st, released Apr 24th)

How to Use IG Client Sentiment in Your Trading
How to Use IG Client Sentiment in Your Trading
Recommended by Justin McQueen
Improve your trading with IG Client Sentiment Data
Get My Guide

US Dollar Bears Slowing Down, GBP/USD Flips to Net Short- COT Report

In the week to April 21st, CFTC data highlights that speculators had been somewhat hesitant, given that positioning changes had been relatively muted. That said, investors had net sold the US Dollar by $168mln against G10 currencies (6th consecutive week of dollar selling), however, selling momentum appears to have moderated. While economies look to re-open, the soft macro backdrop remains (particularly over Europe), which in turn keeps the greenback with an upside bias. It is only when the global economy begins to recover can we expect to see a potential pullback in the US Dollar.

Non-commercials are net short on the Pound for the first time since December. Last week’s Brexit talks provided little signs of encouragement for GBP, with EU’s Barnier stating that progress had been disappointing. This provides us with a reminder that Brexit induced volatility will be back on the rise in the run-up to transition extension deadline (June 30th). As such, with markets yet to notably re-price Brexit risks, there is a potential for an increase in speculative bearish positioning, leaving the Pound vulnerable.

Across commodity currencies, bearish positioning had eased, largely led by short covering. CAD investors had seemingly ignored the technical selling in oil, which saw prices go negative for the first time on record.

Investors remain constructive on both the Japanese Yen and Swiss Franc. In recent weeks, dips in the Japanese Yen have been well supported. This had been apparent last week when source reports that the BoJ were to announce unlimited QE saw initial JPY weakness quickly faded. Upside in the Swiss Franc however, considers to face a significant hurdle against the Euro.

Elsewhere, positioning changes in the Euro were unchanged. Short covering had been the key reason behind the increase in net Euro longs over the past two months, however, as European sovereign risks re-emerge, there is a potential for outright Euro shorts to pick up once again and thus leave the Euro exposed to a sizeable drop.

Please add a description for the image.

US Dollar | Bearish Momentum Slows Down

Please add a description for the image.

EUR/USD | Short Positions Picking Up

Please add a description for the image.

GBP/USD | Investors Flip Net Short for First Time Since December

Please add a description for the image.

USD/JPY | Dips in Yen Remain Supported

Please add a description for the image.

USD/CHF | Key Hurdle Caps Upside

Please add a description for the image.

USD/CAD | Undeterred by Negative Oil Prices

Please add a description for the image.

AUD/USD | Unwind of Net Shorts Support AUD

Please add a description for the image.

NZD/USD | Positioning Largely Neutral

Please add a description for the image.

For a more in-depth analysis on FX, check out the FX Forecast

--- Written by Justin McQueen, Market Analyst

Follow Justin on Twitter @JMcQueenFX

DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.

DISCLOSURES