These are the main highlights of the CFTC Positioning Report for the week ended on July 6th:
- Speculators added gross longs to their dollar positions for the third week in a row, taking the net position to the highest level since early June 2020. The upside in the US Dollar Index (DXY) was propped up by increased volatility and rising inflows into the safe haven universe. Of note is that the percentage of net longs on open interest climbed above the 20%, levels last seen in June 2020. Back to that period, DXY experienced quite a selloff from the 97.60 zone to the 92.60/92.00 range recorded in September 2020.
- Net shorts in EUR receded to nearly 3-month lows. The drop in EUR/USD still tracked the investors’ assessment of the shift in the Fed’s stance as well as the improved mood in the safe haven space.
- The speculative community reduced its net shorts in the Japanese yen on the back declining US yields and supportive inflows in response to the pick-up in cases of the Delta variant of the coronavirus across the globe. Still among the safe havens, CHF net longs dropped to 3-week lows.
- Net longs in the sterling climbed to 3-week highs despite the erratic performance of cable. Doubts regarding the growth prospects for the UK economy remained on the rise in response to the quick spread of the Delta variant in the country. In addition, investors stayed vigilant following the latest cautious stance from the BoE.
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