CFTC report from July 12 covered information available on July 9

According to the Commodity Futures Trading Commission (CFTC) report, market participants keep holding net short speculative positions against the US dollar in all major currencies. The largest net short positions observed on the Japanese yen, the euro and the Australian dollar. Slightly smaller volumes of short positions are seen on the British pound and Canadian dollar. Positioning on the Swiss franc is very close to a balance state, even though it confirms the predominance of short positions.

According to the latest report, the greatest (negative) change is occurred in the positioning on the European currency. Net short positions on the Japanese yen and the Canadian dollar also rose, but in much smaller scale. Finally, the Australian dollar was the only currency having the net short position reduced.

In general, the current positioning is in line with our medium-term forecasts. We expect a large-scale strengthening of the American currency in the second half of the year. Short positions in the Japanese yen, the euro and the British pound seem to us especially interesting from a strategic point of view.

Australian dollar keps holding a significant net short position vs. the US dollar, but its volume decreased to -5.8 billion USD. The Australian dollar is the third currency by the largest net short position, after only the Japanese yen and the euro.

After a short break, market participants retook the net short position on European currency, that was $ -6.5 billion USD last week. The bearish sentiment is prevailing.

The net short position on the British pound rose to -3.2 billion USD. The bearish sentiment is prevailing.

The net position of the Swiss franc remains close to a state of complete balance, although it is short. The sentiment is neutrally-negative.

Yen firmly holds the leadership by the largest net short position against the US dollar. Last week, it rose to -9.9 billion USD. The sentiment remains bearish.