The Currency Report

The Currency Report

By Paul Kavanaugh

Large Currency Speculators again added to new recent net long positions in Japanese Yen, while significantly boosting existing net shorts of commodity currencies including Australian and Canadian dollar, latest CFTC data shows…

Canadian Dollar

(Commitments of Traders Data)

CFTC data released Friday January 22, 2016 shows large currency speculators increased long Yen positions by over 50%, building on two weeks’ ago reversal to net long.  This week’s data also showed over 50% increases in net short positions in the Canadian and Australian dollar.

These significant percent change moves highlight one of the main goals of this report; which is to keep an eye on what large speculators are doing over the longer term with their positions, with the assumption that they large speculators are positioning in the direction of the longer term trend.

The existing and building net short positions in commodity currencies like the Australian and Canadian dollar suggest the weakness in the commodity sector will continue over the near term in my opinion, which I have published in The Currency Report since 12/28/2015.

Highlighted Currency, net position and % change

Net Longs                                            Net Shorts

JY +37k +50%                                     CD -66k +128%

AD -36k +57%

The most recent Commitments of Traders data shows some significant percentage changes in non-commercial futures only net positions from the prior week including the following:

A sharp 128.66% increase from 29,032 to 66,386 contracts net short of the Canadian dollar, which represents 22.59% of open interest;

A reversing 127.26% change from long 3,324 to short 906 contracts of the Swiss Franc, which represents 127.26% of open interest;

A building 26.4% increase from 30,521 to 38,579 contracts net short of the British Pound, which represents 13.1% of open interest;

A substantial 50.22% increase from 25,066 to 37,653 contracts long of the Japanese Yen, which represents 5.08% of open interest;

A minor 6.44% decrease from 146,451 to 137,015 contracts net short of the Euro, which represents 2.36% of open interest;

A significant 57.39% increase from 23,043 to 36,267 contracts net short of the Australian Dollar, which represents 9.96% of open interest;

A negligible 0.13% increase from 42,719 to 42,775 contracts net long of the US Dollar Index, which represents 0.07% of open interest;

(Source: www.CFTC.gov)

For those interested in Stock Index Futures, it may be of interest that over the same period large speculators again increased their net short positions in E-Mini S&P 500 Stock Index by 16.19% from 162,272 to 188,536 contracts.  Feel free to contact me directly for more specific information.

For more information on FuturePath Trading, LLC PhotonTrader Software Demos and Futures and Forex Brokerage services email paul@fptrading.net or call 312.987.2080.

Good Trading,

Paul Kavanaugh

There is a substantial risk of loss in trading futures and options. Futures, options and foreign exchange trading are not appropriate for all investors.  Past performance is not indicative of future results. The information and data in this report were obtained from sources considered reliable. Their accuracy or completeness is not guaranteed and the giving of the same is not to be deemed as an offer or solicitation on our part with respect to the sale or purchase of any securities or commodities.  FuturePath Trading, LLC, its officers and directors may in the normal course of business have positions, which may or may not agree with the opinions expressed in this report. Any decision to purchase or sell as a result of the opinions expressed in this report will be the full responsibility of the person authorizing such transaction.

Paul Kavanaugh

About Paul Kavanaugh

Paul Kavanaugh has been active in the commodity markets as an NFA member for 24 years. He specializes in working with clients by providing innovative personalized value-added services. His guidance with regards to risk management has attracted large commercial hedgers. His 2 1/2 decades of experience in navigating commodity bull and bear markets and extremes in volatility, while maintaining an even keel temperament, has made him an appreciated right hand man to select CTAs and professional traders. Paul’s early apprenticeship with one of the more renowned pioneers of systems development and seasonal work landed him position as Senior Analyst for one of the world’s largest clearing firms at the time. His published currency analysis achieved a remarkably broad following. He then branched out to supporting traders through brokerage services, often 24 hours round the clock. Paul has been happy to share his knowledge with new clients. His warm-hearted enthusiasm for both the markets and people provides an old school blend missing in today’s hard and fast world of electronic trading. At the same time, his current affiliation with the long established Independent Brokerage Firm, FuturePath Trading, LLC, allows him to offer clients the resources of multiple Clearing firms and execution platforms. Paul received his degree in Economics from Albion College in Michigan. He has been a frequent contributor to CBS, CNBC, and the WSJ over the years.

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