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Positions of large speculators according to the COT report as at 14/5/2021

The total net positions of speculators in the USD index grew by 400 contracts last week. This change is the result of an increase in long positions by 5,100 contracts and an increase in short positions by 4,700 contracts.

 

The total net positions of speculators rose last week in the euro, the Australian dollar, the New Zealand dollar, the Canadian dollar and the British pound.

 

The decline in the total net positions of speculators occurred in the Japanese yen and the Swiss franc.

 

There is still a risk of sentiment in the market, with the US stock indices hovering near their historic highs. There was a minor correction to the indices last week, but on Thursday and Friday the indices began to rise again. In such an environment, commodity currencies and the euro tend to strengthen.

 

In addition, recent developments in the US dollar pairs have been determined by developments in US long-term bond yields. They fell last week and the US dollar weakened. However, in the event of their further stronger growth, it cannot be ruled out that the dollar could start to strengthen again.

 

The positions of speculators in individual currencies

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.

 

 

14/5/2021

7/5/2021

30/4/2021

23/4/2021

16/4/2021

9/4/2021

USD index

2,500

2,100

2,700

3,500

6,000

4,400

EUR

93,900

84,800

81,000

80,800

66,900

67,500

GBP

28,200

19,800

29,200

25,200

25,600

20,000

AUD

2,400

1,500

-1,400

-1,800

3,800

4,100

NZD

9,300

8,600

7,000

4,300

2,500

3,100

CAD

38,600

25,900

15,722

13,200

2,400

2,700

CHF

-2,900

100

-700

-1,600

800

3,200

JPY

-41,700

-41,500

-48,500

-59,800

-58,300

-58,000

Table 1: Total net positions of large speculators

 

Notes:

Large speculators are traders who trade large volumes of futures contracts, which, if the set 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 long-term trends and their goal is to make money on speculation with the instrument.

The total net positions of large speculators are the difference between the number of long contracts and the number of short contracts of large speculators. Positive value shows that large speculators are net long. Negative value shows that large speculators are net short. The data is published every Friday and is delayed because it shows the status on Tuesday of the week.

The total net positions of large speculators show the sentiment this group has in the market. A positive value of the total net positions of speculators indicates bullish sentiment, a negative value of total net positions indicates bearish sentiment.

When interpreting charts and values, it is important to follow the overall trend of total net positions. The turning points are also very important, i.e. the moments when the total net positions go from a positive value to a negative one and vice versa. Important are also extreme values of total net positions as they often serve as signals of a trend reversal.

Sentiment according to the reported positions of large players in futures markets is not immediately reflected in the movement of currency pairs. Therefore, information on sentiment is more likely to be used by traders who take longer trades and are willing to hold their positions for several weeks or even months.

Detailed analysis of selected currencies

Explanations:
 

Purple line and histogram in the chart window: this is information on the total net position of large speculators. This information shows the strength and sentiment of an ongoing trend.

Green line in 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.

Information on the positions of so-called hedgers is not shown in the chart, due to the fact that their main goal is not speculation, but hedging. Therefore, this group usually takes the opposite positions than the large speculators. For this reason, the positions of hedgers are inversely correlated with the movement of the price of the underlying asset. However, this inverse correlation shows the ongoing trend less clearly than the position of large speculators.

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

Euro

Date

Weekly change in open interest

Weekly change in total net positions of speculators

Weekly change in total long positions of speculators

Weekly change in total short positions of speculators

Sentiment

14.5.2021 19,800 9,100 16,900 7,800 Bullish
7.5.2021 5,300 3,800 6,000 2,200 Bullish
30.4.2021 10,400 200 3,300 3,100 Bullish
 
COT-14-5-obr-1.png
Figure 1: The euro and COT positions of large speculators on a weekly chart


The total net positions of speculators grew by 9,100 contracts last week. This change is due to an increase in long positions by 16,900 contracts and an increase in short positions by 7,800 contracts.

The euro price tested the declining line of the triangle last week, confirming its support and leaving room for further growth.

Long-term resistance: 1.2240 - 1.2350

Long-term support: 1.1700 - 1.1750
 

The British pound

Date

Weekly change in open interest

Weekly change in total net positions of speculators

Weekly change in total long positions of speculators

Weekly change in total short positions of speculators

Sentiment

14.5.2021 21,200 8,400 12,800 4,400 Bullish
7.5.2021 -8,500 -9,400 -7,700 1700 Weakening bullish
30.4.2021 -3 000 -4 000 -1 100 -5 100 Bullish

 

COT-14-5-obr-2.png
Figure 2: The GBP and COT positions of large speculators on a weekly chart


Last week, the total net position of speculators grew by 8,400 contracts. This change is the result of an increase in long positions by 12,800 contracts, while net short positions grew by 4,400 contracts.

The pound continued to strengthen strongly last week and is approaching the resistance threshold.

 

Long-term resistance: 1.42-1.4350

 

Long-term support: 1.3670-1.3700
 

The Australian dollar

Date

Weekly change in open interest

Weekly change in total net positions of speculators

Weekly change in total long positions of speculators

Weekly change in total short positions of speculators

Sentiment

14.5.2021 3,300 900 800 -100 Bullish
7.5.2021 -3,100 2,900 -1,400 -4,200 Bullish
30.4.2021 4,600 400 3,000 2,600 Weakening bearish
 
COT-14-5-obr-3.png
Figure 3: The AUD and COT positions of large speculators on a weekly chart


Last week, the total net positions of speculators grew by 900 contracts. This change is due to an increase in long positions by 800 and a decrease in short positions by 100 contracts.

The Australian dollar weakened slightly last week after testing the level of resistance. If the SP 500 index strengthens this week, the Australian dollar should also strengthen.

Long-term resistance: 0.7870-0.8000

 

Long-term support: 0.7530-0.7600
 

The New Zealand dollar

 

Date

Weekly change in open interest

Weekly change in total net positions of speculators

Weekly change in total long positions of speculators

Weekly change in total short positions of speculators

Sentiment

14.5.2021 1,000 700 0 -700 Bullish
7.5.2021 400 1,600 500 -1,100 Bullish
30.4.2021 3,500 2,700 4,200 1,500 Bullish

COT-14-5-obr-4.png
Figure 4: The NZD and the position of large speculators on a weekly chart


Last week, total net positions grew by 700 contracts. This change is the result of a decrease in short contracts by 700.

The NZDUSD also weakened slightly last week. The movement of the NZDUSD pair is also strongly correlated with the AUDUSD, so this pair could also strengthen if the SP 500 index rises this week.

Resistance: 0.7370-0.7450

The nearest support: 0.6900-0.6960