Weekly COT Report: JPY Shorts Lowest Since 2012

  • CFTC Data: USD aggregated net long positions decreased 5.1%% to $37.2bln as traders reduced long USD bullish bets as domestic data continues to disappoint proving cover for the FOMC to delay any move on rates for now
  • EUR net spec shorts increased from 212,347 to 214,645 contracts this week an increase of 1.8%.
  • GBP net shorts are at the lowest levels in the past month 29,281 v 36,045 contracts
  • JPY short positioning decreased 37.5% to the lowest levels since late 2012.
  •  AUD net shorts decreased 17.4%

 

EURUSD – Outlook Bearish

Monetary and political matters continue to dominate the EUR trade, the main focus as we closed out the week was the looming Greek debt deadline although it appears another fudged deal will be hammered out last minute to delay any real resolution. It is likely that we could see a further relief bounce on such news before ECB policy once again takes centre stage. Key German data will be the EUR focus this week along with Eurozone CPI.

  • Strength active sell signal, consolidates recent gains
  •  Index active sell signal, ticking down from last week’s highs
  •  Momentum active buy signal, long positions in play.
  • Order Flow Trader Bearish

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GBPUSD – Outlook Bearish

Continues to grind out new gains clearing 150 and 1.51 this week squeezing late shorts out of poorly placed positions. BOE minutes were taken hawkishly and propelled cable through some key levels. The key concern now is regarding short term volatility as we head into the major political headline risk of the UK General Election at the beginning of May, it is likely we will witness some position adjustment as we head into the polling period.

  • Strength active sell signal, ticks up from last week’s lows
  • Index active sell signal, continues to tick up, consolidating last weeks gains
  • Momentum active buy signal, ticking up to highest levels in 2015
  • Order Flow Trader Bullish

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USDJPY – Outlook Bullish

Ranges rule the roost in the JPY complex, most participants are reluctant to take any meaningful risk on board ahead of next week’s crucial BOJ. Most market players seem to sense that we are likely to get any significant further easing measures from this week’s meeting and COT data of late has reflected the lack of appetite to short JPY at current levels.

  • Strength active buy signal, continues to decline from January highs
  • Index active sell signal, at 2015 lows
  • Momentum active sell signal, consolidates last week’s gains
  • Order Flow Trader Bullish

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USDCHF – Outlook Bearish

Data continues to disappoint Friday’s durable goods data was no exception, most feel that the current round of weakness in US economic numbers will give the FOMC the cover they need to stand pat on a move ahead of September. Focus moves to this week’s raft of data and USD bulls will be looking for a rebound in economic sentiment to reposition on the long side.

  •  Strength active buy signal, consolidates recent declines
  • Index sell signal active, consolidates recent gains from depressed levels
  • Momentum sell signal active, ticks down at recent lows
  • Order Flow Trader Bearish

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AUDUSD – Outlook Bearish

RBA minutes were AUD supportive as the Bank held off a rate cut, however the reluctance move in April has many market players pricing in a very high probability of a cut in May. CPI data also came in, in line as such the AUD has remained bid this week but many are cautious regarding any meaningful gains as concerns regarding China growth data continue to cloud the trading outlook for the AUD.

  • Strength active sell signal, ticking back up
  • Index active buy signal, ticking back up
  • Momentum active buy signal, ticking back up
  • Order Flow Trader Bullish

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USDCAD Outlook – Bullish

Data has been supportive for the CAD in recent weeks coupled with a stabilisation in Oil prices these two factors have led the BOC to sound less doveish in recent communications. GDP data on Thursday is the headline release for the Canadian currency, which will be closely watched to see just how the drop in oil prices affected the country’s economy.

  • Strength active buy signal, consolidating just below 2015 highs.
  • Index active sell signal, sell at Fridays close or better
  •  Momentum sell signal, short positions in play
  • Order Flow Trader Bearish

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