The CFTC Report-Japanese Yen Net Short Tamed

The latest report by Commodity Futures Trading Commission (CFTC) covering data up to the 6th of May showed that investor’s bias is changing with some currencies compared to the previous report. The Euro bullish bias strengthened against the US dollar that week and represented the largest positive weekly change among major currencies. At the same time the Japanese Yen negative bias declined by $1.14 billion that week but continues to be the largest net short position at minus $7.46 billion. Moreover, the British pound had the greatest weekly negative change of $0.34 billion reducing the bullish bias to $4.31 billion.

Furthermore, the Euro increased its net long to $5.66 billion in that week. The weekly change stood at $1.22 billion. However, the Euro against the US dollar declined on Thursday and Friday and for that reason we expect the latest upside construction has already been offset. The British pound shows some moderation because of the strong resistance limiting upside.

Elsewhere, the greenback was strengthening against its peers. The Swiss franc net long position slightly declined to $1.88 billion, falling weekly by $0.053 billion. The Canadian net long declined by $0.13 billion that week, with the net short position placing now at $2.90 billion. Our expectation is that we will see the Canadian dollar to pare back its losses, since the USDCAD is down trending. Lastly, bullish bias toward the Australian dollar remains though moderated in recent week.