The weekly data from the US CFTC covering the week ending July 31 showed another big reduction in the aggregate net long dollar position held by hedge funds and other large speculators in IMM currency futures.
During the week all eight IMM currencies, apart from MXN, were bought against the dollar bringing the net dollar long down by 40 percent to USD 10.9 billion. Since the early June peak for dollar bullishness the aggregate long position has been reduced by almost three quarters.
Highlights:
* The EUR net short position remains by far the biggest net short position against the dollar with further short covering likely to have taken place last Friday following the US employment report. Last time the net short were at current (reduced) levels the EURUSD was trading above 1.3000.
* Both AUD and JPY net long positions continue to build with the AUD especially having seen a swing of 88k contracts in less than two months;
Click here to read the full report: FX CFTC 080612
Ole Hansen,
SAXO BANK