Total net speculator positions in the USD index fell by 730 contracts last week. This change is the result of an increase in long positions by 2,270 contracts and an increase in short positions by 3,000 contracts.
The decrease in total net speculator positions occurred last week in the euro, the British pound, and the Canadian dollar.
The increase in total net positions occurred in the New Zealand dollar, the Australian dollar, the Japanese yen and the Swiss franc.
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 08, 2022
Mar 01, 2022
Feb 22, 2022
Feb 15, 2022
Feb 08, 2022
Feb 01, 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 58,844 contracts last week, down by 6,095 contracts from the previous week. This change is due to an increase in long positions by 14,198 contracts and an increase in short positions by 20,393 contracts. These data suggest a weakening of the bullish sentiment for the euro.
Open interest, which rose by 19,015 contracts in the past week, shows that the downward price action movement that occurred in the euro last week was supported by volume and it was therefore a strong trend.
The euro continues to weaken under the influence of the war in Ukraine and we can see that support levels have not been respected in such a strong trend. The ECB's announcement last week to end the bond purchases in 3Q 2022 also contributed to the euro’s weakness. This hawkish statement at a time when economic growth is slowing sparked fears of stagflation in the market and therefore the euro weakened following the ECB announcement.
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 reached - 12,526 contracts, having fallen by 12,189 contracts compared to the previous week. This change is due to the growth in long positions by 3,303 contracts and the growth in short positions by 15,492 contracts. This suggests bearish sentiment as the total net speculators positions are negative while there has been a further decline as well.
Open interest, which rose by 34,443 contracts last week, means that the fall in the pound that occurred last week was supported by the volume and it was therefore a strong price action.
Risk off sentiment due to the war in Ukraine continues to weigh on the pound as well as the euro and therefore the pound is weakening strongly.
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 78,195 contracts, up by 141 contracts compared to the previous week. This change is due to the growth in long positions by 6,801 contracts and the growth in short positions by 6,660 contracts. This data suggests a weakening of the bearish sentiment for the Australian dollar.
Last week we saw an increase in open interest of 7,427 contracts. This means that the downward movement that occurred last week was supported by volume as new money flowed into the market.
The Australian dollar weakened quite significantly last week. This may be explained by the fact that there has been a fall in prices in commodities that Australia exports (e.g. gold, coal). The decline in commodity prices also reflects efforts to find a diplomatic solution to the war in Ukraine.
Long-term resistance: 0.7370-0.7440
Long-term support: 0.7085-0.7120. A strong support is near 0.6960 – 0.6990.
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 a negative value last week - 12,379 contracts, having increased by 1,793 contracts compared to the previous week. This change is due to an increase in long positions by 5,290 contracts and an increase in short positions by 3,497 contracts. This data suggests that the bearish sentiment on the NZ dollar has weakened over the past week.
Open interest rose significantly by 2,861 contracts last week. The downward movement in the NZDUSD that occurred last week was therefore supported by volume and therefore the move was strong.
The weakening in the NZDUSD that occurred last week can be explained by the decline in the prices of commodities that New Zealand produces.
Long-term resistance: 0.6850 – 0.6920
Long-term support: 0.6590-0.6600 and the next support is at 0.6500 – 0.6530.
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.
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