Sat, May 28, 2022 @ 23:43 GMT
HomeContributorsTechnical AnalysisWeekly COT Report: Bearish Exposure to AUD Hits a New Record

Weekly COT Report: Bearish Exposure to AUD Hits a New Record

AT -91.5k contracts net-short, it is the most aggressively bearish exposure on AUD futures by large speculators on record.


AUD futures:

Traders sold short 1.8k contracts against the Australian dollar and trimmed longs by -249 contracts, which takes the net-sort exposure to a new record of -91.5k contracts. Whilst shorts rose a little last week, the increase of short exposure has mainly been a function of longs being closed out since the end of November. Yet despite the bearish exposure to AUD prices continue to hold up well overall, which means we need to see prices roll over or bears will be forced to close and potentially spark a short-covering rally (like we’ve seen on GBP futures recently).

EUR futures:

Traders flipped to net-long exposure on euro futures by 6 contracts. Yet we note there is a lot of trading activity in both directions, with longs and shorts sitting around 200k contracts each, so it appears investors are hedging their bets. So for a sustainable move to materialise we’d need to see a significant reduction in longs or shorts, as opposed to newly initiated activity.

JPY futures:

Last week traders closed 18.4k long contracts on yen futures and added 6.8k short contracts, which saw net-short exposure increase by 25.3k contracts. Yet prices went on to rally 1.48%, most of which was seen on Wednesday – a day after the report was compiled. So we have to assume some of those shorts have since been closed.

As of Tuesday 11th January 2022:

  • Traders increased net-long exposure to WTI futures by 27.7k contracts
  • Large speculators trimmed net-long exposure to gold futures by -11.6k contracts

WTI futures:

Traders increased their net-long exposure to WTI futures by 27.7k contracts last week, which is the most bullish weekly increase in 13-months. As gross logs have been trending lower for about a year it raises the odds that net-long positioning has seen a trough, and oil prices could potentially rally from here.
DISCLAIMER: The information and opinions in this report are for general information use only and are not intended as an offer or solicitation with respect to the purchase of sale of any currency. All opinions and information contained in this report are subject to change without notice. This report has been prepared without regard to the specific investment objectives, financial situation and needs of any particular recipient. While the information contained herein was obtained from sources believed to be reliable, author does not guarantee its accuracy or completeness, nor does author assume any liability for any direct, indirect or consequential loss that may result from the reliance by any person upon any such information or opinions.

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