C.O.T Report – Week 43 2016. EUR most bearish in years
- October 30, 2016
- Posted by: HumbleTraders
- Category: Commitments of Traders
The Commitments of Traders Report is issued by CFTC.
It reports all open positions in futures markets of three main groups of traders:
Commercial Traders – Hedgers
Non-Commercial Traders – Money Managers
Non-Reportable – Retail market
The report breaks down each Tuesday’s Open Interest and gives us a powerful view on what exactly the big guys have been doing in the marketplace and what their plans might be.
It is issued every Friday and includes data from Tuesday to Tuesday. The three days prior to the release date are not included.
In this report, we cover EURO, GBP, AUD, JPY, CAD, CHF and we focus on Non-Commercial traders as an indication of a profit driven bias.
EURUSD: Bullish/Extremely bearish
GBPUSD: Bullish/Extremely bearish
USDJPY: Flat/ Turning Bullish
EURO – Euro Futures
EURUSD moved sharply up from the support driven mainly by US election happenings.
Speculators kept adding short positions into higher prices and driven them to multi year highs. Historically, these levels where quickly followed by market reversal to the upside.
Speculators covered 16K longs and 3K shorts – bearish sign.
They are 137K net short, up from 123K last week.
Open interest dropped first time in 7 weeks.
My analysis from the previous week stands valid
SPECULATIVE SHORTS REACHED 266K.
This is an extreme level and has proven to be a bullish reversal point in the past.
Open interest reached multi-year extreme level at 448K.
To confirm the reversal, we should be seeing a drastic reduction of short orders in the coming weeks, much lower open interest and rising prices.
Due to technical issues, the last week of data isn’t populated on the chart below. Please refer to data in tables.
GBP – British Pound Future
Recent break from the consolidation area might signal major market reversal.
Strategy: Buy dips
This week speculators kept their positions unchanged.
They are 83K net short.
Open interest climbed to 267K.
My analysis stands firm; I expect GBP to bottom around this level and the price to pick up in the next few trading weeks.
AUD -Australian Dollar Futures
Bullish to 0.85
Speculators added another 2.3K longs and covered 6.5K shorts
They are 40K net long, up from 31K last week and 29K two week ago.
The open interest levels are nowhere near extreme levels, which suggests, there is much more room for the price to climb.
JPY -Japanese Yen Futures
Bearish on USDJPY. Currently in short position, waiting for rallies to add more shorts.
Speculators covered .3K longs and kept shorts unchanged
Open interest was up on falling prices, signalling more decline to come.
There could be a opportunity to sell USDJPY, given the pair reach a major resistance at 104.70 area and is due a correction.
CHF – Swiss Franc Futures
CAD – Canadian Dollar Futures
Buy USDCAD on dips
This week speculators added 2.5K new longs and 5K new shorts.
They are 15K net short, up from 13K last week.
Open interest had risen by 7.6K contracts.
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