Specs caught EUR shorts into ECB - ANZ

By FXstreet.com | June 08, 2014 AAA

FXStreet (Bali) - FXStreet (Bali) - The CFTC specs positioning data for the week ending 3 June 2014 shows further evidence that the latest rise in EUR/USD post ECB has all the hallmarks of a short covering rally.

Key Quotes

"Positioning data in the lead up to the 5 June ECB meeting showed leveraged funds increasing their short bets against the EUR for the fourth consecutive week. Since the May Governing Council meeting when ECB President Draghi indicated that policy action was possible, leveraged funds sold 71.8k net contracts worth USD12.4bn. This change in positioning indicated that the market was well positioned for the June ECB meeting. The next set of data will tell us the extent that leveraged funds have unwound their EUR short positions."

"The increase in EUR shorts, alongside a rise in JPY net short positions, resulted in a reduction in net short positions against the US dollar by USD3.1bn. Overall short positions against the US dollar implied by the CFTC data stands at USD3.0bn, its lowest level since mid-February."

"Despite falling iron ore prices, net long positions in AUD rose by 5.3k contracts (USD0.5bn) to 33.7k (USD3.1bn). There were negligible changes in NZD positioning."

" Net long positioning in GBP reduced by 2.6k contracts to 115.0k, but remains at elevated levels. After five consecutive weeks of increasing their bets on Swiss franc depreciation, leveraged funds reduced some of their net short positions against CHF by 2.3k contracts to 6.8k."

"Bullish bets on gold continue to be pared back. Net long non-commercial position in gold fell by 15.8k contracts to 76.9k. This is the lowest net long position since late-January, when gold prices were trading at similar levels to now. Net long positioning in crude oil fell by 10.2k contracts to 433.8k. Despite the well-publicised decline in dairy prices, non-commercial net long position in milk rose to 4.7k contracts, the highest since mid-2008."

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