JPY longs reduced, broad-based USD buying - ANZ

Research Team at ANZ, lists down the CFTC speculative positioning data for the week ending 2 August 2016.

Key Quotes

Leveraged funds were net buyers of USD for the fifth consecutive week, increasing their overall net long position by USD2.9bn to USD16.3bn, the highest in six months. USD buying was broad-based despite the DXY declining following the July FOMC and BoJ meetings. This suggests a strong interest to buy dollars on dips.

The largest positioning change in the week occurred in JPY. Leveraged funds reduced their net long JPY positions by USD1.0bn despite the rally in the yen following the 29 July BoJ meeting which delivered less easing than expected. It is possible that the reduction in net long positions to USD3.8bn could be due to profit taking.

Meanwhile, funds further increased their net GBP short positions for the fifth consecutive week, ahead of the 4 August BoE meeting. Overall, net short GBP positions now stand at USD5.2bn, close to the recent highs in March. EUR also saw its overall net short position rise for the fifth consecutive week by USD0.3bn to USD16.7bn.

Commodity currencies saw net selling in the week, halting five straight weeks of buying. Leveraged funds reduced their CAD and AUD net longs by USD0.2bn and USD0.4bn respectively while keeping NZD net long positions unchanged at USD1.7bn. The change in the AUD’s positioning would have incorporated the RBA’s rate cut decision on 2 August.

Funds remained net sellers of EM currencies for the second consecutive week, adding to their net short MXN, BRL, and RUB positions by a combined USD0.3bn.

Crude oil non-commercial net long positions were reduced for the ninth consecutive week. Gold saw a return of net buying after three weeks of selling.”