Main conclusions
Scaling back on net short EUR position and stretched Scandies
- SEB RAI and the Carry index moving higher and RAI is now closing in an the recent highs seen in mid
Oct 2011. - Speculators finally started to scale back on their short net EUR positions this reporting period (25 – 31 Jan) following five weeks of increasing record short EUR positioning. The small amount of long EUR contracts added last period were one hint that this was in the making. However, the change in net positioning this period is only due to reduced short contacts and the net position is still massively short.
- The net USD long position fell to the lowest level since week of 22 Nov (the 4th largest decrease seen over the last 52 weeks). However, the net long position is still at the 73 percentile i.e. well above its median level.
- AUD & NZD net long positions continued to increase a lot while CAD was the only currency this period with increasing net short position vs. USD. Commodity currencies (AUD, CAD, NZD), EUR and now also CHF have high speculative presence and though the GBP speculative share of open interest increased significantly is still very low.
- The short EUR/PLN position indicated by our FX O-meters last week is 1.5% in the money and the indication is that the trend should continue. NZD/USD and AUD/USD trends are indicated to hold and (as their net long positioning still isn’t excessive) current dips (as current levels are only the 4th highest day out of the last 20 days) should be bought (but beware of RBA rate decision tonight).
- The strongest trends are, just as last week, down in EUR/PLN and up in NZD/USD and AUD/USD while the most notable stretches are seen in the Scandies and EUR/CAD.
Click here to read the full report: Speculative Position 20120206
SEB tech team