USD Index Futures Recorded Net Length, First Time since March
As we expected, USD Index futures turned to NET LENGTH of 18 contracts in the week ended May 15. This was driven by increasing pessimism over other major currencies. According to CFTC's Commitments of Traders report, reduction in speculative long positions greatly surpassed that of short for EUR futures,...
Traders Trimmed Long Position on Crude Oil as Price Approaches Peak in Near Term
Speculators generally stayed bullish over the energy complex in the week ended May 15. Although Net LENGTH for crude oil futures slumped -35 484 contracts from a week ago to 644 444, that for heating oil rose +9 610 contracts to 42 070. Also, net LENGTH for gasoline added +11 166 contracts...
Dollar Rally Limited by a Number of Political Factors, Swiss Franc Ended as Strongest
Swiss Franc ended last week as the strongest one, very much thanks to the selloff in EUR/CHF. Uncertainty over the EU policy of the new Italian government sent Euro broadly lower, which ended as the weakest. Despite surge in 10 year yield to 7-year high, Dollar could only extend...
Euro Weighed Down by Italy, CAD Lower on Data, Dollar Back in Spotlight
Dollar takes back the driving street in early US session as it jumps higher against all other major currencies. Swiss Franc is probably the only one that can counter Dollar's strength, as helped by the selloff in EUR/CHF. Euro is weighed down by news that the populist parties of...
Canadian Dollar Lower on NAFTA Deadlock, Awaits CPI and Retail Sales
Dollar remains the strongest one for the week as supported by treasury yields. 10 year yield extended recent rally to close at 3.109 overnight, and it hits as high as 3.127 in Asian session. 30 year yield also jumped to near 30 year high at 3.246, breaking a key...
USDJPY Surges as 10 Year Yield Breaks 3.1, Sterling Pares Gains after May Dismissed Customs Union Stay
Dollar is extending its rally against Yen today, hitting as high as 110.79 so far. Persistent strength in treasury yield is giving the greenback some lift. 10 year yield reached as high as 3.12 earlier today and is staying firm at around 3.1. Nonetheless, while Dollar is firm against...
Sterling Rebounds as UK May Stay in Customs Union after Brexit, Beyond 2021
US treasury yields rally continues with 10 year yield hitting as high as 3.109 in Asian session. But the lift to Dollar is rather non-existence this time. The greenback is trading generally lower against others today and is mixed for the week. Sterling, on the other hand, is the...
Crude Oil in Fresh 3.5-Year Highs on Inventory Draw and Geopolitical Tensions
Renewed geopolitical tensions and decline in US inventory have lifted oil prices, sending the front-month WTI and Brent crude oil contracts to highest levels since 4Q14. The Brent crude, pressing the US$ 80/bbl-level, is about to record its 6th consecutive weekly gain. The strength in oil prices, accompanied by...
Euro Cracked Down by Italian Populist Duo, Safe Haven Flow Caps Dollar Gains
Politics are the main drivers in the forex markets today. Euro tumbles broadly on concern of the populist policies of the coalition government in Italy. EUR/USD finally took out 1.1822 support decisively But the more important development could be in EUR/CHF which dives through 1.8 handle. Dollar actually doesn't...
Dollar Held by Near Term Resistance Despite Yield Inspired Rally
Dollar surged broadly as boosted by rally in US Treasury yield. 10 year yield hit as high as 3.90 overnight, the highest level since 2011, before settling at 3.08. While the greenback is strong, it's struggling to break through near term resistance levels decisively against Euro and Sterling for...
PBOC Prone to Adopt Less Tightening as April Data Proves Slowdown Underway
China’s macroeconomic data was mixed in April. Industrial production (IP) expanded +7% y/y, accelerating form +6% in March and consensus of +6.4%. Retail sales grew +9.4% y/y, easing from +10.1% in March. The market had anticipated a milder drop to +10%. Urban fixed-asset investment (FAI) increased +7% in the...
Dollar Shines as 10 Year Yield Hits Highest Since 2011
Dollar surges broadly today as boosted by strong rally in treasury yield. 10 year yield reaches as high as 3.049 so far today and breaks key resistance level of 3.036 (2013 high). TNX reaches the highest level since 2011. Released from US, retail sales rose 0.3% mom in April,...
History Repeats Itself – Argentina Seeks IMF Bailout
Failure to rescue currency slump despite aggressive rate hike has led Argentina to seek IMF bailout. Last week, it was reported by the government has asked for a flexible credit line worth $30B from the world lender. According to President Mauricio Macri, “this is going to allow us to...
Dollar Recovers as EURUSD Fails 1.2, UK Employment and German ZEW Watched
Dollar's corrective pull back yesterday was rather brief and shallow. EUR/USD reached 1.1995 but failed to break through 1.2 handle. It's now back at 1.1930. USD/CHF breached parity briefly to 0.9956 and is back above 1.0000 now. GBP.USD continued to stay in tight range above 1.3459 and failed even...
Euro Jumps as ECB Villeroy Indicates Rate Hikes Just Some Quarters Away from End of QE
Euro rises broadly today as lifted by hawkish comments from an ECB official. Sterling closely follow as the second strongest one. On the other hand, New Zealand dollar continues to suffer broad based selling pressure today, in particular against Australian Dollar. Yen follows as the second weakest on optimism...
Risk Appetite Returns as Trump Offers Concession ahead of US-China Trade Talks, Yen Weighed Down
Yen trades broadly lower today, expect versus New Zealand Dollar. Solid risk appetite is a factor pressuring the Yen. Nikkei closed up 0.47% at 28865.86, hitting the highest level in more than three months. Strong performance of cosmetics maker Shiseido is a factor driving the Japanese markets up. But...
Traders Getting More Bearish on AUD and Less Bullish on GBP
We initiate coverage on speculators' activities on major FX futures. According to CFTC's Commitments of Traders, speculators were bearish (NET SHORT) on CHF, JPY, AUD and CAD in the week ended May 8. Meanwhile, they remained bullish (NET LENGTH) over EUR, GBP and NZD. However, the positive sentiment has...
Traders Stayed Mixed about Energy as Trump Pulled Out of Iran Deal
Speculators were mixed over the energy complex in the week ended May 8. Net LENGTH for crude oil futures plunged -10 799 contracts from a week ago to 679 928. NET LENGTH of heating oil rose +5 463 contracts to 32 460 while net LENGTH for gasoline added +1 726 contracts...
Dollar Turned into Consolidation Phase, Sterling Survived BoE but Vulnerable to Job Data
Canadian Dollar surged broadly last week following the rally in oil prices. Weaker than expected employment capped the Loonie's gain, but it ended as the strongest still. Sterling survived BoE super Thursday and ended up against all but Canadian. That's a clear indication that markets didn't see BoE announcements...
Canadian Dollar Lower after Employment Miss, But US Dollar Even Worse
Canadian dollar drops broadly as employment data missed market section. While it's trading as the weakest one for today, the movement in USD/CAD is rather muted. That's because focus is turning to the greenback again as selling gathers momentum. Weakening treasury yield could be a factor driving the greenback...