EUR bulls & GBP bears add to extended positions – Scotiabank

According to the CFTC data which covers up to Tuesday, August 22 & were released Friday August 25, major positioning adjustments were confined to EUR and GBP as bullish investors added to the former while bearish investors added to the latter.

Key Quotes

“Risk was reduced in CAD and AUD while leaving the net unchanged. Net NZD, MXN, CHF and JPY positions were also left unchanged on a w/w basis. EUR remains the largest held net long, followed by AUD, CAD, MXN and NZD. The CHF position is flat, and JPY and GBP are held net short. The aggregate USD short widened a modest $0.5bn w/w to $13.8bn.”

“CAD positioning remains bullish with a $4.1bn net long. Details hint to a mild paring of risk as investors reduced gross long and gross short positions by roughly $0.3bn. This was the second consecutive week of profit taking among CAD bulls. Investors also made similar adjustments in AUD positions while leaving the $4.8bn net long relatively unchanged on a w/w basis.”

“EUR’s net long position was up $1.3bn w/w to $12.9bn, recovering a portion of last week’s decline. The improvement was almost entirely driven by EUR bulls as gross longs climbed $1.2bn w/w. EUR gross longs are just shy of the record high from two weeks ago.”

“GBP saw the only major deterioration this week with a $1.1bn widening in the net short to $3.7bn. Bears were responsible for roughly $0.9bn of the deterioration as they added to gross shorts while bulls reduced their gross longs by $0.2bn. GBP sentiment has deteriorated in four of the past five weeks.”