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Positioning Does Not Pose A Barrier For EUR/USD Upside‏

Published 03/10/2014, 07:38 AM
Updated 05/14/2017, 06:45 AM
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The latest IMM data covers the week from 25 February to 4 March.

According to the latest IMM data, the biggest change in G10 positioning in the week ending 4 March was seen in the EUR where investors nearly doubled their speculative long EUR positions ahead of the ECB meeting (see page 2 for details). Data showed that speculators also unwound USD longs for the fourth consecutive week and overall USD positioning has in the four weeks moved from the 97th to the 87th percentile (still stretched long). Although an additional number of short EUR/USD positions have probably been flushed out following the ECB meeting on Thursday, EUR positioning remains in neutral territory and thus, from a positioning point of view, there should be no immediate barrier for further near-term EUR/USD upside.

Investors also added net longs in the safe haven currencies CHF and JPY – probably as a consequence of the intensification in the Ukraine crisis in the same week (Russian soldiers invading Crimea). While CHF positioning remains broadly square, speculators continue to be very short the Japanese currency.

Non-commercial positioning remains very stretched short CAD and AUD with little change in positioning in the week to 4 March. On the other hand, speculators continue to add NZD net longs, sending total NZD positioning to the 74th percentile. Measured in percentage of open interest, speculators have not been this long NZD since May 2013. Consequently, positioning begins to pose a barrier for further moves lower in the AUD/NZD and CAD/NZD.

In commodities, net longs were added in wheat, corn, gold and soybeans. In a historical perspective, however, positioning is only stretched in the latter. Net shorts were added in oil and copper.

To Read the Entire Report Please Click on the pdf File Below

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