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Positions of large speculators according to the COT report as at 12/2/2021

Total net positions in the USD index rose by 900 contracts last week. This change is the result of a decrease in net short positions by 900 contracts. The total net positions in the USD index have been negative for fourteen weeks in a row. The US dollar weakened at the end of last week. According to the COT index, the positions of large speculators are at extreme values, however, from the point of view of price action analysis, the reversal of the trend has not been confirmed yet. The dollar could thus continue its downtrend.

The increase in total net positions occurred in the euro and the British pound. By contrast, total net positions fell in the Australian dollar, the New Zealand dollar, the Japanese yen, the Canadian dollar and the Swiss franc.

Risk on sentiment persists in the markets and the SP500 stock index reached a new high last week. This could be favorable for commodity currencies, but also for the euro and the British pound, which could strengthen.
 

The positions of speculators in individual currencies

 

12/2/2021

5/2/2021

29/1/2021

22/1/2021

15/1/2021

8/1/2020

USD index

-13,900

-14,800

-14,700

-14,300

-13,900

-15,000

EUR

140,200

137,000

165,300

163,500

155,900

143,000

GBP

21,100

9,700

8,000

13,700

12,900

3,700

AUD

-200

-1,500

800

4,900

5,500

- 3,900

NZD

11,500

11,600

14,800

16,000

14,700

12,000

CAD

9,500

16,100

13,800

10,300

12,100

14,500

CHF

11,400

14,600

10,100

9,400

12,000

9,400

JPY

34,600

44,600

45,000

50,000

50,500

50,200

Table 1: Total net positions of large speculators

 

Notes:

Large speculators are traders who trade large volumes of futures contracts, which, if the required limits are met, must be reported to the Commodity Futures Trading Commission. Typically, this includes traders such as funds or large banks. These traders mostly focus on trading of long-term trends.

Total net positions are the difference between the number of bullish long contracts and the number of bearish short contracts. The data is published every Friday and is delayed because it shows the status on Tuesday of the week.

The sentiment of large speculators will allow you to see what position this group occupies in the market. It is important to monitor the overall trend of total net positions, but also separately the trend of bearish short positions and the trend of bullish long positions. Extreme values ​​of total net positions are also important as they often serve as signals of a trend reversal.

It is also important to monitor the turning points, when the total net positions change from bullish sentiment to bearish and vice versa. These inflection points are indicated in the graphs in section 3.

The chart compares the current value of the total net positions of large speculators with the value 3 years ago. A score of 0% means that speculators are at their lowest levels in 3 years. A score of 100% means that speculators are at the highest values ​​in the last 3 years. A value of 80% or more means that speculators are extremely bullish, and a value of 20% or less means that speculators are extremely bearish.
 

Detailed analysis of selected currencies

Explanations:
 

  • Purple line and histogram in the chart window: this is information on the overall net position of large speculators.

  • Green linein the indicator window: these are the bullish positions of large speculators.

  • Red line in the indicator window: indicates the bearish positions of large speculators.
     

If there is a green line above the red line in the indicator window, then it means that the overall net positions are positive, i.e. that bullish sentiment prevails. If, on the other hand, the green line is below the red line, then bearish sentiment prevails and the overall net positions of the big speculators are negative.

Charts are made with the use of www.tradingview.com.


 

Euro

Weekly change in total net positions

Weekly change in total long positions

Weekly change in total short positions

Sentiment

3,200

4,000

800

bullish


COT report - euro - 12. 2. 2021

Figure1: The euro and COT positions of large speculators on a weekly chart


Total net positions grew by 3,200 contracts last week. This change is due to an increase in net long positions by 4,000 contracts and an increase in net short positions by 800 contracts.

The euro price strengthened last week and rejected broken support on the low rising line. This confirmed a false break. In situations where there is a false break, there is a higher probability of moving in the original direction, i.e. in the case of the euro in the long direction and the euro could therefore strengthen further.
 

Long-term resistance: 1.2250 - 1.2340

Long-term support: 1.1940 - 1.2000
 

The British Pound

Weekly change in total net positions

Weekly change in total long positions

Weekly change in total short positions

Sentiment

11,400

6,800

-4,600

bullish


COT report - british pound - 12. 2. 2021

Figure 2: The GBP and COT positions of large speculators on a weekly chart


Last week, total net positions rose by 11,400 contracts. This change is the result of an increase in net long positions by 6,900 contracts, while net short positions decreased by 4,500 contracts.

The pound continued to strengthen last week, breaking the resistance threshold at around 1.38 and continuing to grow.
 

Long-term resistance: 1.42-1.4350

Long-term support: 1.37-1.38200
 

The Australlian Dollar

Weekly change in total net positions

Weekly change in total long positions

Weekly change in total short positions

Sentiment

1,300

200

-1,100

weak bearish


COT report - australian dollar - 12. 2. 2021

Figure 3: The AUD and COT positions of large speculators on a weekly chart


Last week, total net positions grew by 1,300 contracts, but they are still in a negative bearish zone. However, current developments suggest that there could soon be a shift to bullish sentiment.

The Australian dollar strengthened slightly last week due to the risk on sentiment in the SP 500 stock index,which the Australian dollar correlates with. We can understand the growing trend line as the current support.
 

Long-term resistance: 0.7750-0.7820

Long-term support: 0.7600-0.7650
 

The New Zealand Dollar

Weekly change in total net positions

Weekly change in total long positions

Weekly change in total short positions

Sentiment

- 100

- 1,400

- 1,200

bullish


COT report - new zealand dollar - 12. 2. 2021

Figure 4: The NZD and the position of large speculators on a weekly chart


In the New Zealand dollar, total net positions are still in bullish sentiment, which has been going on for 26 weeks in a row. Last week total net positions fell by 100 contracts. This change is the result of a decrease in net long contracts by 1,400 and a decrease in net short contracts by 1,300.

The NZDUSD price strengthened slightly last week. As with the Australian dollar, the NZDUSD can be expected to strengthen given the risk on sentiment and the new high on the SP 500 index.


Resistance: 0.7230-0.7320

The nearest support: 0.7050-0.7100