Speculative investors in the eight IMM currency futures tracked in this report continued to scale back their dollar long positions for a third week. The data from the CFTC covering the week ending August 7 showed the aggregate dollar long position falling to USD 7.8 billion, down 30 percent on the week and it is now some USD 33 billion lower since the June 5 peak.
Highlights:
* AUD was in demand for a fourth week as it continues to recover from sharply oversold conditions. The gross short position remains elevated so further upside could trigger additional short-covering.
* EUR was the second most bought currency last week. Despite the 38 percent reduction in short positioning since the June 6 peak the net short remain entrenched with recent Draghi comments (about doing whatever it takes) not having had a “game changing” impact on speculators’ predominant negative attitude to the single currency.
* JPY longs were trimmed as the currency paused following the recent rally.
* GBP was sold again and speculators have now held a negative view on the currency for the past 10 weeks.
Click here to read the full report: FX CFTC_081312
Ole Hansen,
SAXO BANK