Observations based on speculative positioning in the Forex Market

1.   There were three significant position adjustments (more than 10k contracts) in the CFTC reporting week ending April 21.  The gross short yen position was cut by almost 12k contracts, leaving 66k, the least since last July.  The reduction of gross short yen positions has been one of the main features of speculative positioning thus far this year. Last December the gross short yen position peaked near 153k contacts.  Following a less dovish line by the Bank of Canada the gross long Canadian dollar position almost doubled to 33.3k contracts (an increase of 10.3k contracts).  The gross long Mexican peso position was cut by 13.2k contracts to 50.3k.  In the prior week, the longs jumped by 21.3k contracts.

2.   This liquidation of long peso contracts swung the net position back to the short side by 13.7k contracts.  The leaves the Swiss franc, among the currency futures we track, where speculators are net long.  The net short yen position of 14.4k contracts is the smallest in 2.5 years.

3.   Speculators hold 55.6k gross long Australian dollar futures contracts, this is the largest gross long position among the currencies we track.  The yen is in a close second with speculators long 51.5k contracts.  The gross short euro position at 261.5k is far and away the largest.  The Australian dollar is a distant second with speculators hold a net short 90.2k contracts.  In the other four currency futures we track, speculators hold a little more than 60k short contracts.

4.   The speculative net short 10-year Treasury futures position grew by 41k contracts.  However, this reflected 54.3k long contracts being cut and nearly 13k short contracts being covered.

5.   The net long speculative oil position rose by almost 41k contracts.  This was not a function of new longs being established.  Rather the gross short position was cut by nearly 50k contracts, while the gross longs were pared by 8.6k contracts.

week ending Apr 21	Commitment of Traders
(speculative position in 000′s of contracts)
Net	Prior	Gross Long	Change	Gross Short	Change
Euro	-215.0	-212.0	46.8	1.6	261.5	3.9
Yen	-14.4	-23.1	51.5	-3.3	66.0	-11.9
Sterling	-29.3	-36.0	34.8	0.8	61.1	-5.9
Swiss Franc	0.3	0.2	11.1	-1.1	10.8	-1.3
C$	-27.1	-30.6	33.3	10.3	60.4	6.8
A$	-34.7	-42.4	55.6	0.5	90.2	-7.3
Mexican Peso	-13.7	8.4	50.3	-13.2	64.0	8.9