Total net speculator positions in the USD index fell by 5,664 contracts last week. This change is the result of a decrease in long positions by 6,264 contracts and a decrease in short positions by 600 contracts.
The decline in total net speculator positions occurred last week in the euro, the British pound and the Japanese yen.
The increase in total net positions occurred in the New Zealand dollar, the Australian dollar, the Canadian dollar and the Swiss franc.
The significant growth in positions of large speculators in the commodity currencies AUD, NZD and CAD can be explained by the rising prices of commodities exported by these countries.
A large number of options and futures contracts expired last week, which explains the large decline in open interest for each currency.
The total net positions of large speculators are shown in Table 1: If the value is positive then the large speculators are net long. If the value is negative, the large speculators are net short.
Mar 15, 2022
Mar 08, 2022
Mar 01, 2022
Feb 22, 2022
Feb 15, 2022
Feb 08, 2022
Note: The explanation of COT methodolody is at the the end of the report.
Charts are made with the use of tradingview.com. The source of numerical data is www.myfxbook.com
Specs Net positions
change Open Interest
change Net Positions
Figure 1: The euro and COT positions of large speculators on a weekly chart and the EURUSD on D1
The total net positions of speculators reached 18 794 contracts last week and they are down by 40 050 contracts compared to the previous week. This change is due to a decrease in long positions by 40,643 contracts and an increase in short positions by 593 contracts. These data suggest a weakening of the bullish sentiment in the euro.
The open interest, which fell by 72,980 contracts in the last week, shows that the upward movement that occurred in the euro last week was not supported by a volume and it is therefore a weak price action.
The euro continues to weaken under the influence of the war in Ukraine. Last week it returned to a resistance level which could be an opportunity to trade short in the event of a downtrend.
Long-term resistance: 1.1120 – 1.1150.
Support: 1.080-1.0850. The next support is at 1.0640-1.0700.
Figure 2: The GBP and COT positions of large speculators on a weekly chart and the GBPUSD on D1
The total net positions of speculators last week amounted to -29,061 contracts and they are down by 16,535 contracts compared to the previous week. This change is due to a decrease in long positions by 18,540 contracts and a decrease in short positions by 2,005 contracts. This suggests bearish sentiment as the total net positions of large speculators are negative while there is also their further decline.
Open interest, which fell by 57,989 contracts last week, means that the rise in the pound price that occurred last week was not supported by volume and it is therefore a weak price action.
Risk off sentiment due to the war in Ukraine continues to weigh on the pound and therefore the pound is weakening strongly. Although the Bank of England raised interest rates by 0.25% to 0.75% last week, it also warned of a decline in economic growth as a result of the war in Ukraine. The change in central bank rhetoric is a bearish signal for the pound.
Long-term resistance: 1.3180-1.3210. Next resistance is near 1.3270 – 1.3330.
Support is near 1.3000.
Figure 3: The AUD and COT positions of large speculators on a weekly chart and the AUDUSD on D1
The total net positions of speculators last week reached - 44 856 contracts, having increased by 33 339 contracts compared to the previous week. This change is due to an increase in long positions by 4,706 contracts and a decrease in short positions by 28,579 contracts. This data suggests a weakening of bearish sentiment in the Australian dollar.
Last week we saw a decline in open interest of 72,573 contracts. This means that the upward move that occurred last week was not supported by a volume and it was therefore a weak move as new money did not flow into the market.
The Australian dollar strengthened strongly again last week and reached a resistance level.
Long-term resistance: 0.7370-0.7440
Long-term support: 0.7160-0.7180. A strong support is near 0.7080 – 0.7120.
Figure 4: The NZD and the position of large speculators on a weekly chart and the NZDUSD on D1
The total net positions of speculators reached 3,653 contracts last week and they are up by 16,032 contracts compared to the previous week. This change is due to an increase in long positions by 5,718 contracts and a decrease in short positions by 10,314 contracts. This data suggests that there was bullish sentiment on the New Zealand dollar last week.
Open interest fell significantly by 14,050 contracts last week. Therefore, the upward movement in the NZDUSD that occurred last week was not supported by volume and therefore the move was weak.
The NZDUSD strengthened strongly last week and reached the resistance level.
Long-term resistance: 0.690 – 0.6930
Long-term support: 0.6730-0.6740 and the next support is at 0.6590 – 0.6600.
Strong bullish market
New money flow in the particular asset, more bulls entered the market which pushes the price up. The trend is strong.
Strong bearish market
Price falls, more bearish traders entered the market which pushes the price down. The trend is strong.
Weak bullish market
Price is going up but new money do not flow into the market. Existing futures contracts expire or are closed. The trend is weak.
Weak bearish market
Price is going down, but new money do not flow into the market. Existing futures expire or are closed, the trend is weak.
What's new in Purple Trading, Market Shot, market analysis and articles...
CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 71.65 % of retail investors lose their capital when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money.
Any opinions, news, research, analysis, prices, or other information contained on this website is provided as general market commentary, and does not constitute investment advice. L.F. Investment Limited. will not accept liability for any loss or damage, including without limitation to, any loss of profit, which may arise directly or indirectly from use of or reliance on such information.
The content on this website is subject to change at any time without notice, and is provided for the sole purpose of assisting traders to make independent investment decisions. L.F. Investment Limited has taken reasonable measures to ensure the accuracy of the information on the website, however, does not guarantee its accuracy, and will not accept liability for any loss or damage which may arise directly or indirectly from the content or your inability to access the website, for any delay in or failure of the transmission or the receipt of any instruction or notifications sent through this website.
At this time L.F. Investment Limited cannot and will not accept clients from outside European Economic Area and from Belgium, Switzerland and USA. You need to be 18 years old or legal age as determined by the laws of the country where you live in order to become our client.
Our payment providers are TrustPay, a.s. authorised and regulated by the National Bank of Slovakia and Emerchantpay Ltd. which is authorised and regulated by the Financial Services Authority (FCA) of the United Kingdom. Our Electronic money institution is Cardpay authorized by Central Bank of Cyprus.
Purple Trading is a Cypriot national trademark (no. 85981), National UK trade mark (no. UK00003696619) and European Union trade mark (no. 018332329) owned and operated by L.F. Investment Limited, 11, Louki Akrita, CY-4044 Limassol, Cyprus, a licensed Cyprus Investment Firm regulated by the CySEC lic. no. 271/15. The company is legally obligated to follow all laws of Cyprus and rules and conditions of its CySEC license. The subsidiary of L.F. Investment Ltd, LFA International Ltd., Aiolou & Panagioti Diomidous 9, Katholiki, 3020, Limassol, Cyprus, registration number: HE422638 is responsible for card processing.