EUR bullish sentiment fades, JPY bears retreat - Scotiabank

According o he CFTC data which covers up to Tuesday September 12 & were released Friday September 15, speculative positioning is little changed in aggregate, with speculative sentiment on the USD deteriorating marginally, notes the analysis team at Scotiabank. 

Key Quotes

“Aggregate positioning does reflect a small increase in the broader bearish bet on the USD, which rose to USD15.8bn, surpassing fractionally the early August peak bear bet of USD15.7bn.  The bearish bet on the USD overall is the largest now since 2013.”       

“Significant positioning changes were highly concentrated this week, reflecting a sharp drop in net EUR longs (down USD1.47bn, driven mainly by an increase in gross shorts) as investors fade the EUR’s recent gains to 1.20.  Offsetting this (in terms of the impact on aggregate USD positioning) was a hefty bout of JPY short covering, equating to USD1.88bn.”           

“Net GBP positioning reflected a cut in bearish bets on the pound— a situation we expect will develop further following the hefty GBP gains this week.  In the week through Sep 12th, gross GBP shorts rose but gross GBP longs increased at double the rate, prompting a USD485mn drop in the net GBP short bet.”   

“Net CAD longs fell USD191mn in the week, accounted for entirely by a cut in gross longs. Net AUD and net NZD longs were reduced modestly.  NET CHF positioning remains relatively flat and was little changed.  Net MXN longs rose slightly in the week (gross longs added a little over 2k contracts while gross shorts fell by around 1k contracts) as sentiment remains generally bullish.”