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CFTC Commitments of Traders – Traders Bet on Higher Euro as ECB Shrugged Off its Strength

As suggested in the CFTC Commitments of Traders report in the week ended January 19 NET SHORT of USD Index futures +370 contracts to 14 277. Speculative long positions gained +1 492 contracts, and short positions increased +1 862 contracts. The greenback's correction proves to be short-lived. The ECB...

CAD Extended Rally as BOC Sounded Less Dovish

BOC’s January meeting came in less dovish than expected. While leaving the monetary policy measures unchanged, the central bank has upgraded the economic outlook for 2022. Meanwhile, policymakers hinted QE tapering if confidence over recovery improves. At the meeting, BOC kept the overnight rate at 0.25% and the QE...

CFTC Commitments of Traders – Rebound in USD Prone to be Short-lived

As suggested in the CFTC Commitments of Traders report in the week ended January 12, NET SHORT of USD Index futures fell -1 045 contracts to 14 952. Speculative long positions dropped -941 contracts, and short positions decreased -1 986 contracts. USD rebounded as talks about Fed's balance sheet...

CAD to Gain Further On Risk Appetite and Higher Crude Oil Price, Upside Limited by BOC Actions

Similar to Australian dollar, Canadian dollar this year should continue to benefit from broad-based USD weakness, global recovery, and rebound in commodity, in particular crude oil, prices. However, with the US as its largest trading partner, BOC should track the Fed’s monetary policy closely, and avoid excessive appreciation of...

CFTC Commitments of Traders – USD Started 2021 with More Selling

As suggested in the CFTC Commitments of Traders report in the week ended January 5, NET SHORT of USD Index futures added +395 contracts to 14 952. Speculative long positions climbed higher, by +279 contracts, and short positions increased +788 contracts. Concerning European currencies, NET LENGTH in EUR futures...

Aussie to Gain Further from Global Reflation Theme, Limited Impact from China’s Boycott

The global reflation theme of 2021 should continue to support AUDUSD. With the cash rate at the effective lower bound, RBA also extended asset purchases worth of AUD100B until mid-2021. Yet, it appears that there is little the central bank can do to curb the currency strength. Risks from...

CFTC Commitments of Traders – USD Index Finished 2020 in Net Short, Losing 6%

As suggested in the CFTC Commitments of Traders report in the week ended December 29, NET SHORT of USD Index futures slipped -318 contracts to 14 557. Speculative long positions gained +1 106 contracts and short positions added +788 contracts. USD Index dropped about -6% last year. Concerning European...

JPY to Continue Grind against USD on Policy Convergence, Reduced Capital Outflow and Current Account Surplus

Japanese yen gained +5% against US dollar last year. The strength was only modest, compared with about +9% gains of AUD, EUR and CHF. Notwithstanding the lackluster improvement in Japan’s inflation outlook and exhaustion of BOJ’s stimulus, we expect Japanese yen to extend its modest gain against the greenback...

Euro to Stay Positive against USD in 2021, though with Upside Limited

After gaining almost +10% this year, we expect EURUSD to strengthen further in 2021. While Eurozone continues to struggle with slow recovery and subdued inflation, the broad-based weakness in US dollar is anticipated to support the pair. As we mentioned in the previous report, we are bearish over US...

Last-Minute Brexit Deal Reached. GBP Upside Limited with Good News Already Priced in

A last-minute Brexit trade deal has been reached just before the Christmas. the outcome is largely inline with our expectations. As a no-deal Brexit is avoided, BOE should be able to keep its powder dry for the year to come. The chance of negative interest rate has also been...

US Dollar to Weaken Further Gradually in 2021

The DXY index will likely record a -6% fall in 2020, the first decline in 3 years. Although US economic recovery should lend support to the dollar, exceptionally accommodative monetary policy, widening deficit (exacerbated by the new round of fiscal stimulus) and reduced demand for safe-haven asset should keep...

CFTC Commitments of Traders – Traders Trimmed Bets on US dollar. Better Sentiment Lifted Risk Currencies

US dollar's weakness continued as risk appetite improved. As suggested in the CFTC Commitments of Traders report in the week ended December 15, NET SHORT of USD Index futures more than doubled to 14 056 contracts. Speculative long positions plunged -8 499 contracts and short positions dropped -929 contracts....

CFTC Commitments of Traders – USD Weakened Further while GBP Slumped on Concerns over No-Deal Brexit

As suggested in the CFTC Commitments of Traders report in the week ended December 8, NET SHORT of USD Index futures more than doubled to 6 486 contracts. Speculative long positions decreased -500 contracts and short positions gained +2 911 contracts. Concerning European currencies, NET LENGTH in EUR futures...

CFTC Commitments of Traders – Sterling and Loonie Strengthened while US Dollar Lacked Direction

As suggested in the CFTC Commitments of Traders report in the week ended December 1, NET SHORT of USD Index futures added  +321 contracts to 3 075. Speculative long positions increased +4 061 contracts and short positions gained +4 382 contracts. The greenback continued to move without direction. Concerning...

CFTC Commitments of Traders – US Dollar on Defensive as Risk Appetite Improved

As suggested in the CFTC Commitments of Traders report in the week ended November 24, NET SHORT of USD Index futures added +1 780 contracts to 2 754. Speculative long positions increased +107 contracts and short positions gained +1 887 contracts. Concerning European currencies, NET LENGTH in EUR futures...

British Pound Remains Strong with Possible Trade Deal in Sight

The market has been thrilled amid signs of progress in the EU-UK deal. Last week, EU Commission president Ursula von der Leyen noted that there was “more movement” on the negotiations "difficult weeks with very, very slow progress". Yet, she warned that there were "some metres to the finish...

CFTC Commitments of Traders – Net Short in GBP Futures could Trim on Signs of Resolving Brexit Deadlock

As suggested in the CFTC Commitments of Traders report in the week ended November 17, NET SHORT of USD Index futures dropped -154 contracts to 974. Speculative long positions increased +937 contracts and short positions gained +783 contracts. Concerning European currencies, NET LENGTH in EUR futures fell -1 327...

CFTC Commitments of Traders – Bets for Lower GBP Increased. Brexit Back on Driver’s Seat as Transition Period Ends Soon

As suggested in the CFTC Commitments of Traders report in the week ended November 10, USD Index futures drifted to NET SHORT of 1 128 contracts. Speculative long positions increased +1 177 contracts and short positions gained +3 046 contracts. Concerning European currencies, NET LENGTH in EUR futures fell...

CFTC Commitments of Traders – USD Index Futures to Return to NET SHORT Next Week as US election Results Get Clearer

The latest CFTC Commitments of Traders report covered the period just before the US presidential election. During the week, bets on US futures slipped on both sides amidst the highly uncertain election outcome. With Joe Biden on the way to become the next president, risk appetite has increased significantly....

CFTC Commitments of Traders – Bets on Falling Euro Soared amidst Fresh Lockdown Measures

As suggested in the CFTC Commitments of Traders report in the week ended October 27, NET SHORT of USD Index futures slipped -412 to 1 254 contracts. Speculative long positions increased +687 contracts and short positions added +275 contracts. Concerning European currencies, NET LENGTH in EUR futures dived -10...