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Speculators Edge U.S. Dollar Bets Up After 4 Down Weeks. Yen, Euro Bets Rise

Published 06/29/2020, 02:53 AM
Updated 07/09/2023, 06:31 AM

US Dollar Index Speculators edge US Dollar bets up

Large currency speculators halted the slide in their US Dollar Index positions this week after pushing USD positions into bearish territory last week, according to the latest Commitment of Traders (COT) data released by the Commodity Futures Trading Commission (CFTC) on Friday.

USD Index COT Futures Large Traders Positions

The non-commercial futures contracts of US Dollar Index futures, traded by large speculators and hedge funds, totaled a net position of -5,314 contracts in the data reported through Tuesday June 23rd. This was a weekly change of +30 contracts from the previous week which had a total of -5,344 net contracts.

This week’s net position was the result of the gross bullish position (longs) gaining by 857 contracts (to a weekly total of 11,653 contracts) compared to the gross bearish position (shorts) which rose by 827 contracts on the week (to a total of 16,967 contracts).

US Dollar Index speculators very slightly trimmed their bearish positions this week following a recent strong downtrend. The USD Index speculator bets had declined in each of the previous four weeks and by a total of -22,641 contracts over that period. These declines pushed the USD Index speculator position into bearish territory for the first time since May of 2018. The USD Index remains in short or bearish territory this week for a second straight week at just over -5,000 contracts.

Individual Currencies Data this week: Euro, Yen and Kiwi bets rise

In the other major currency contracts data, we saw most of the individual currency contracts rise in the speculators category this week.

Japanese yen speculators raised their bullish bets this week for a second straight week and for the third time in the past five weeks. Overall, yen bets have now risen in ten out of the past sixteen weeks after bets turned from bearish to bullish on March 10th.

Euro speculator positions continued to see higher levels this week and rose for a fifth consecutive week. These recent gains have pushed the current standing (+118,448 contracts) to the highest level since May 8th of 2018 when net positions totaled +120,505 contracts. Amazingly, the euro net position was in negative territory just sixteen weeks ago on March 10th before bullish bets rose in twelve of the next fifteen weeks.

New Zealand dollar speculator positions improved for the sixth consecutive week this week and net positions have risen by a total of +15,863 contracts in this period. These recent gains have brought the overall speculator standing to the best level (currently at just -15 contracts this week) since contracts were net bullish on January 28th.

Overall, the major currencies that saw improving speculator positions this week were the US dollar index (30 weekly change in contracts), euro (1,316 contracts), Japanese yen (5,348 contracts), Canadian dollar (4,652 contracts), Australian dollar (1,722 contracts), New Zealand dollar (1,917 contracts) and the Mexican peso (1,072 contracts)..

The currencies whose speculative bets declined this week were the British pound sterling (-2,518 weekly change in contracts) and the Swiss franc (-158 contracts).

Chart: Current Strength of Each Currency compared to their 3-Year Range

Current Strength of Each Currency

The above chart depicts each currency’s current speculator strength level compared to data of the past 3 years. A score of 0 percent would mean speculator bets are currently at the lowest level of the past three years. A 100 percent score would be at the highest level while a 50 percent score would mean speculator bets are right in the middle of the data (a neutral score). We use above 80 percent (extreme bullish) and below 20 percent (extreme bearish) as extreme score measurements.

Please see the data table and individual currency charts below.

Table of Large Speculator Levels & Weekly Changes:

Table Of Large Speculator Levels & Weekly Changes

This latest COT data is through Tuesday and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets. All currency positions are in direct relation to the US dollar where, for example, a bet for the euro is a bet that the euro will rise versus the dollar while a bet against the euro will be a bet that the dollar will gain versus the euro.

Weekly Charts: Large Trader Weekly Positions vs Price

EuroFX:

Euro COT Futures Large Traders Positions

The Euro large speculator standing this week equaled a net position of 118,448 contracts in the data reported through Tuesday. This was a weekly boost of 1,316 contracts from the previous week which had a total of 117,132 net contracts.

British Pound Sterling:

British Pound COT Futures Large Traders Positions

The large British pound sterling speculator level totaled a net position of -18,516 contracts in the data reported this week. This was a weekly decrease of -2,518 contracts from the previous week which had a total of -15,998 net contracts.

Japanese Yen:

JPY COT Futures Large Traders Positions

Large Japanese yen speculators resulted in a net position of 27,458 contracts in this week’s data. This was a weekly advance of 5,348 contracts from the previous week which had a total of 22,110 net contracts.

Swiss Franc:

CHF COT Futures Large Traders Positions

The Swiss franc speculator standing this week totaled a net position of 1,448 contracts in the data through Tuesday. This was a weekly reduction of -158 contracts from the previous week which had a total of 1,606 net contracts.

Canadian Dollar:

CAD COT Futures Large Traders Positions

Canadian dollar speculators equaled a net position of -20,834 contracts this week. This was a advance of 4,652 contracts from the previous week which had a total of -25,486 net contracts.

Australian Dollar:

AUD COT Futures Large Traders Positions

The large speculator positions in Australian dollar futures reached a net position of -4,810 contracts this week in the data ending Tuesday. This was a weekly increase of 1,722 contracts from the previous week which had a total of -6,532 net contracts.

New Zealand Dollar:

NZD COT Futures Large Traders Positions

The New Zealand dollar speculative standing totaled a net position of -15 contracts this week in the latest COT data. This was a weekly increase of 1,917 contracts from the previous week which had a total of -1,932 net contracts.

Mexican Peso:

MXN COT Futures Large Traders Positions

Mexican peso speculators equaled a net position of 23,178 contracts this week. This was a weekly increase of 1,072 contracts from the previous week which had a total of 22,106 net contracts.

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