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Forex pairs in this Article » EUR/USD, USD/CHF, GBP/USD (Bali) - IMM positioning data for the week ending on Jan 14 reflect specs warming to the USD a little more, notes Shaun Osborne, Chief FX Strategist at TD Securities.

Key Quotes

"The net long USD position rose to an aggregated total equal to USD 21.3bn in the week through January 14th, today’s CFTC data showed. That’s the biggest net long exposure to the USD since July last year."

"Speculative accounts continue to trim net long EUR positions—now down to just 9.2k contracts and essentially back to where positioning was in early December before the late year rally in the EUR. Further liquidation seems very likely in next week’s data on the basis of the slide in the EUR today."

"Investors also cut net long GBP positions this week, with the net total long of 11.6k contracts down 50% from the late December positioning."

"The CHF was something of an outlier in this week’s data, with investors taking a small net short in the Swissie for the first time since August."

"Net JPY shorts remain at impressive levels but the recent rebound in the JPY is reflected in the light short-covering trend revealed in the CFTC data over the past 3-4 weeks. Net shorts peaked recently around –143k contracts in the Dec 24th week and have fallen to –118k in the latest week’s data. This remains a relatively large exposure though and one which will make a clear mark on price action in the event of a more rapid move to cover shorts."

"Net CAD shorts continue to rise incrementally, meanwhile, with investors warming steadily to the soft CAD trend. Net CAD shorts rose 7k contracts to –67.3 this week, the biggest net short CAD position since late April. Net CAD shorts peaked at –75.9k contracts last April and the record peak short was –84.9k contracts in early 2007. CAD net shorts are getting up there but still have some room to grow. AUD net shorts were trimmed modestly in the latest week (-51.9k contracts) while net NZD longs were boosted slightly (to +9.6k)."

"Net MXN longs were cut back modestly to +13.7k contracts, down from +17.6k contracts last week. Participation remains well below the interest seen in this market last year (+151.6k contracts)."
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