CFTC: Still Awaiting Meaningful Position Changes

Summer vacations have mostly ended.  The news stream has picked up.  Yet speculators have been mostly reluctant to make meaningful changes in their exposure to the currency futures.

There are a few notable exceptions.  First, over the past several weeks, speculators have reduced gross short euro positions by more than 20% since the end of July.  It stands at 173.3k contracts, after the bears covered 16.7k contracts in the CFTC reporting period ending September 13.

Summer vacations have mostly ended.  The news stream has picked up.  Yet speculators have been mostly reluctant to make meaningful changes in their exposure to the currency futures.

There are a few notable exceptions.  First, over the past several weeks, speculators have reduced gross short euro positions by more than 20% since the end of July.  It stands at 173.3k contracts, after the bears covered 16.7k contracts in the CFTC reporting period ending September 13.

If the bears were pulling back in the euro, they were showing their claws on the Mexican peso.  The gross short position rose by 10.4k contracts, after increasing by 22k contracts the previous reporting period.  At 85.7k contracts, the gross short position is the largest since April.  The net short peso position has more than doubled to 65.7k contracts in the past two weeks.

Although the position adjustments in sterling have been modest, the market has turned and has stopped extending gross and net short positions. Both have fallen for two consecutive reporting periods from record levels.  The gross short speculative position fell by 5.5k contracts to 123.2k contracts, roughly the same amount that was covered in the previous week.

The bottom pickers have slowly entered the market.  The gross long position bottomed in mid-July near 28k contracts.  It edged up 1.6k contracts in the latest reporting period to 40.1k contracts.  The net short sterling position of 82.8k contracts surpassed the euro (net short 81.5k contracts) to have the dubious honor of the largest such speculative position.

The Canadian dollar joined the Mexican peso as the two exceptions to the general move by speculators to cover short currency futures position.  The bears added 5.5k contracts to their gross short position, lifting it to 28.7k contracts.  Speculators also reduced exposure in the Australian and New Zealand dollars by liquidating gross longs and covering gross shorts, but total gross adjustment were less than 7.5k contracts.

The bears are slowly moving into ascendancy in the US 10-year Treasury note futures.  They added another 14.6k contracts to lift it to 566.6k contracts.  It has risen by about 145k contracts since the end of July.  The bulls sold 22.2k contracts, leaving them with a gross long position of 635.2k contracts.  The gross long position peaked in late-June a little over 720k contracts.  The net position remains long, but it fell to 68.6k contracts from 104.8k.

The speculative bears in the light sweet crude oil futures had second thoughts.  After adding more than 50k contracts to the their gross short position in the previous reporting period, speculators covered 23.6k contracts in the most recent week.  The gross short position now stands at 224.7k contracts.  The bulls tread water and added 3.9k contacts to lift the gross long position to 538k.  These adjustments were reflected in the 27.5k contract increase in the net long position.  It stands at 313.3k contracts.

Speculators Remain Mostly Unswayed by the News is republished with permission from Marc to Market