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CFTC commitments of traders: EUR longs move back up to December highs

  
Analysis, Forex

Weekly forex futures positioning data from the CFTC

  • EUR long 156K vs 143K long last week. Long increased by 13K
  • GBP long 13K vs 4K long last week. Longs increased by 9K
  • JPY long 50K vs 50K long last week. Unchanged
  • CHF long 12K vs 9K long last week. Longs increased by 3K
  • AUD long 5K vs 4K short last week. Longs increased by 9K
  • NZD long 15K vs 12K long last week. Longs increased by 3K
  • CAD long 12K vs 14K long last week. Longs trimmed by 2K
Highlights:
  • EUR longs remain the largest speculative position at long 156K. That equals the December high long position.
Weekly forex futures positioning data from the CFTC_
  • JPY longs at 50K are unchanged but remain the next largest net speculative position
  • AUD position switched to long 5K from short 4 last week.
  • All major currencies are now long the currency (short the USD).

The short term lid on the US dollar

  
Analysis, Forex
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Comments from Westpac senior currency analyst Sean Callow quoted in a Reuters piece in response to Powell speaking on Thursday (US time).

  • “Shorter-term, Powell just put a lid on the US dollar”
  • “The baseline case is still for a substantial acceleration in the global economy, which historically has proven to be positive for most currencies against the USD, but I think there is potential to at least have a debate over whether us USD will be quite as weak as people expect. “

Will INR appreciate against the US dollar in 2021?

  
Analysis, Forex

Is the Indian Rupee set for a third straight year of fall against the USD or will it make a comeback in 2021?

FXLRImage source: PixaHive2020 has been a highly volatile year for the major international currencies, as international trade and supply chain disruptions combined with mixed investor sentiment led to extensive fluctuations.As an aftermath of the pandemic, the world’s reserve currency the U.S. dollar (USD), has declined steeply throughout the past year, making it the worst-performing currency among the G10 currencies.This is reflected in the US Dollar Index’s 7.53% decline over the past year. The Indian Rupee (INR) did not fare any better, as it was the worst-performing currency in the Asian subcontinent over the past year.

INR and USD – 2020 Performance

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USD/CAD climb above the early-2021 high

  
Analysis, Forex

USD/CAD breaks 1.2800

USD/CAD breaks 1.2800
USD/CAD is up more than 130 pips on the session as the US dollar extends its advance.
There’s some risk off tone and WTI crude is down 50-cents but this is mostly about the broad US dollar advance. The move has caught the market off guard and it’s starting to look like a real squeeze.
The three doji candles followed by this big move up today is a solid reversal signal for a pair that’s trended lower since March.
We will hear from the BOC today via the Business Outlook survey. It’s a key input for the central bank and should offer some clues on the real-time state of the economy.
If there is a broad US dollar rebound, the Canadian dollar should tail close behind. It will be one of the big beneficiaries of US spending and Trudeau also isn’t afraid of a massive deficit. If the Fed starts to tighten, the BOC will be right behind and it’s tough to envision a reflation trade without commodity inflation.
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