Latest CFTC Release Dated March 6th , 2007:
British Pound Longs Fall Significantly
Note:
The charts used to interpret the Commitment of Traders data now include both net positioning and the percentile indicator. The percentile indicator value is the current net positioning as a percentile when measured against the last 52 weeks. A 4 week moving average is applied to that number in order to smooth out the data. A reading above 90 indicates extreme bullishness and a reading below 0 extreme bearishness. Market turns occur at extreme levels of optimism and pessimism (bottoms at pessimism and tops at optimism). Therefore, readings below 10 on the percentile indicator give scope to bottom formation. Readings above 90 give scope to a topping formation.
US Dollar Index: Implied dollar positioning flipped back to positive a week after flipping to negative. The flipping back and forth from net long to net short and back to net long is indicative of the range environment that the greenback is experiencing. The percentile indicator decreasing from above 90 favors the downside.
EUR: Euro net longs decreased a week after a new record was set for long positions. With long positions decreasing from record levels, we continue to see the possibility that the euro could reverse and head lower.
GBP: Long positioning continues to fall decrease from the record levels set in January (when Cable hit 1.9915). The deterioration in long positions indicates a change in sentiment. The trend appears to be towards GBP selling now, thus we continue to favor the downside.
CHF: CHF net speculative positioning has increased a good amount the past two weeks from extremely bearish levels. The percentile indicator has rallied above 10, indicating that the CHF may begin to outperform the other currencies (but not necessarily the USD).
JPY: Yen positioning has also increased the past two weeks from record short levels. The interpretation is the same as that of the CHF. Look for the JPY to also outperform.
CAD: CAD positioning has improved from record short levels also. The percentile indicator has increased above 10 so look for the CAD to also begin outperforming (USDCAD should be topping out).
AUD: Long positions decreased significantly from last week. The percentile indicator recently declining from extreme bullish levels (above 90) favors the downside over the longer term.