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Forex pairs in this Article » EUR/USD, USD/CHF, GBP/USD, USD/JPY (Bali) - The FX Commitments of Traders Report saw some significant position adjustment in the week through Dec 3rd, with a jump in the total number of outstanding contracts (to 270k from 214k) also suggesting a gain in conviction, notes TDS.

Key Quotes

"Investors remained overall optimistic on the USD, particularly against the JPY. The implied USD long position held steady at USD18.9bn as of Tuesday v. USD19.1bn in the week prior."

"Speculators added considerably to EUR and GBP exposure from the nearly neutral positions in both currencies last week. Net EUR positioning jumped to long of 9.3k contracts, from short of 0.4k contracts last week, while GBP longs were boosted to 18.4k from 0.4k."

"The extreme short position the JPY became even more extreme this week, with investors continuing to pile into the short JPY trade. Net shorts increased to 133.4k contracts from 123.2k last week, a level that is certainly vulnerable to a short squeeze with the right trigger."

"Investors also continued to sour on the commodity currencies, notably extending short positions in the AUD and CAD, and cutting NZD longs. The AUD short jumped to 44.3k contracts from 33.5k (the largest net short position since September) and the CAD net short leaped to 41.6k contracts from 28.8k (the largest short since May). Meanwhile NZD longs were trimmed to 7.6k from 10.2k."

"The net CHF long position was increased modestly to 6.5k contracts from 4.7k in the week prior, while the MXN net long was pared to 8.9k from 12.5k. MXN exposure continues to remain well below the levels earlier this year, prior to the ‘taper-trade’ induced slashing of long positions."
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