Currency speculators in the Chicago futures market in the week ended November 30 trimmed back net long euro positions since the prior week, International Monetary Market data from the Commodity Futures Trading Commission showed on Friday. "Long" positions are de facto bets a specific currency will strengthen, while "short" positions are effectively bets it will weaken.
Speculators generally are trend followers seeking to pick a precise top or bottom in the market.
According to the data, euro futures speculators' net long positions declined to 24,485 contracts in the latest week, the lowest level since early September, from 32,261 contracts the prior week.
"That would be consistent with what we are seeing in that we are getting an unwind of euros by shorter-term names, but we are getting continued dollar selling and buying of euros by accounts that are not so concerned with shorter-term moves," said T.J. Marta, senior currency strategist with RBC Capital Markets in New York.
The euro hit fresh record highs against the dollar on Friday around $1.3460 according to Reuters data as the greenback languished, hurt by a disappointing US jobs report and persistent concerns about the wide current account deficit.
The IMM data from the CFTC's Commitments of Traders report on speculative positioning are used by analysts as an indicator of future market direction.
Extreme net long positions, for example, often signal a decline in a currency going forward, since the build-up of positions reflects what has already happened, not the growing risk of a reversal when the market is heavily positioned one way.
Comments
Comments are closed.