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Limited position adjustments in currency futures - BBH

FXStreet (Bali) - Marc Chandler, Global Head of Currency Strategy at BBH, reviews that latest changes in the speculative positioning in the futures market for the week ending Tuesday 21st Oct, noting that position adjustments in the currency futures were limited.

Key Quotes

"Despite the large swings in the spot market, position adjustments in the currency futures were limited. There was only one gross position adjustment larger than 10k contracts. Gross short yen positions were culled by 25.6k contracts to 98.4k. This was the largest short-covering since March."

"Speculators responded to the large price swings by reducing positions. Of the 14 gross positions we track, nine were reduced. Gross long positions were cut except in the Japanese yen, where they grew by less than 4k contracts. Gross euro long euro positions were flat, but at 60.2k contracts, it remains the largest gross long position among the currency futures. Short positions were also generally reduced but did edge higher in the euro, Australian dollar, and Mexican peso."

"The net short euro position has grown for three consecutive weeks. Speculators are accumulating a large short position in the dollar-bloc currencies and the Mexican peso. The net short Canadian dollar position of 21.5k contracts is the largest since late-May. The 31.5k net short Australian dollar contracts are the largest net short position since March. Speculators are net short 21.1k peso contracts, which is the largest since late February."

"The net short 10-year US Treasury speculative futures position was reduced to 90k contracts from 123k. Speculators piled into the longs, growing the gross position by almost 37k contracts to 456.7k. The short added a slight 3.6k contracts to 546.7k."

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