The latest IMM data covers the week from 27 January 2015 to 6 February 2015.
IMM positioning data released on Friday revealed that non-commercial EUR positioning - measured as percentage of open interest - deteriorated for the fifth consecutive week , bringing speculative positioning in the single currency below the third percentile for the first time since August 2012. The move was the primary contributor in expanding the aggregate USD bullish positions this week. Noteworthy, in light of the recent improvement in JPY sentiment , bearish EUR positions now make up by far the largest share of non-commercial USD positioning at roughly 60% (see page 2).
We believe that the stretched positioning together with the technical oversold levels have been a contributing factor for the recent EUR/USD correction higher, which in light of the dramatic fall in recent months was probably overdue. In addition, the recent rise in the oil price has also given some tailwind to the EUR. Fundamentally, we still expect EUR/USD to edge gradually lower in H1 and target the cross at 1.10 in 6M.
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