Crypto

Forex traders are more bullish on the USD for 2.5 years

COT Weekly Report: Most Bullish Forex Traders on the USD for 2.5 Years

The bullish positioning of the US dollar in the currency market has reached new highs, ahead of aggressive comments from Jerome Powell last week.

To Tuesday, November 30, 2021

  • Forex traders added $ 2.5 billion to the net long USD exposure, bringing it to $ 24.4 billion, its highest level since June 2019.
  • Net short exposure to sterling futures has been the most bearish in over 2 years.
  • Bears added +16.9,000 short contracts last week

Dollar bulls are getting stronger

According to data compiled by IMM (International Money Markets), forex traders have been the most bullish on the US dollar since June 2019. The table below shows exposure to G10 currencies and emerging market currencies in a “stacked” graph, which, when combined, represents total exposure. Its latest peak was around + $ 34 billion and its all-time high is around $ 51 billion, so it doesn’t appear to be at an extreme level at the moment.

dollar dxy forex 06122021

Forex traders are the most bearish on sterling futures for 2.5 years

Forex traders increased their gross short exposure in GBP futures to 91,000 contracts, which is the highest level since October 2019. As gross long positions remained stable, this brought the net short exposure to its lowest level in 2.5 years. Historically, traders have been much more bearish than that, so there are no immediate signs of a reversal, and we may see more extreme net exposure if longs start to close.

pound sterling gbp forex 06122021

Bears return to Australian dollar

Currency traders hit a high net bearish exposure in October on Australian Dollar (AUD) futures, which is often a red flag for extreme sentiment. Needless to say, many of these bears were forced to hedge when Australian dollar prices refused to decline, but we’ve since seen a surge in gross short bets last week where 16,9,000 new contracts were hit. short. resulting in a short net exposure to a minimum of 8 weeks. And with an aggressive Fed and stubbornly accommodating RBA, we may see further shorting pressure on the Aussie, which closed below 0.70 on Friday.

australian dollar forex aud 06122021

As of Tuesday, November 30, 2021:

  • The rises and falls continued to reduce his exposure to gold futures
  • Net Platinum Futures Selling Exposure Hits 4-Week High
  • The closing of the bullish bets on copper futures resulted in a net long exposure to a 3-month low

forex commodities 06122021

Bullish bets on copper continued to decline

Net long exposure to copper futures fell for the sixth week in a row and is now at its lowest level in 3 months. The main driver of this movement is due to the closing of long contracts, as opposed to the launch of new short contracts. While this does not make a compelling case for a bearish case, it does explain why the copper price they are struggling to rally and trade in a volatile range around $ 4.30 USD. Ultimately, we maintain a bullish bias above $ 4.00 overall, but prepared for more short-term sideways action.

copper 061202021

By Matt Simpson, Forex.com » Official site

Disclaimer: The information and opinions in this report are provided for general information only and do not constitute an offer or solicitation to buy or sell currency or CFD contracts. Although the information contained in this document has been taken from sources considered reliable, the author does not guarantee its accuracy or completeness, and assumes no responsibility for any direct, indirect or consequential damages that may result from the fact that someone trusts such information.

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