Tags: Speculators | Increase | Bets | Against | Dollar

Speculators Increase Bets Against Dollar

Friday, 04 Dec 2009 04:34 PM

Currency speculators increased bets against the U.S. dollar in the latest week to the most since at least June, 2008, according to Commodity Futures Trading Commission data released on Friday.

The value of the dollar's net short position rose to $21.8 billion in the week ending Dec. 1 from a net short position of

$18.65 billion in the prior week, according to the CFTC data, a Reuters calculation and Reuters data.

The aggregate U.S. dollar position is derived from the net positions of International Monetary Market speculators in the

yen, euro, British pound, Swiss franc, Canadian and Australian dollars.

Investors again increased net long yen positions, which rose to 56,907 contracts from 51,170 in the prior week. The number of net long yen positions was the highest since the week ended March 25, 2008, according to Reuters data.

Open interest in yen positions rose 12,290 contracts to 144,123 contracts.

Open interest is taken as a sign of the strength in a given price movement, though not an indication of direction. Increasing open interest is said by analysts to illustrate strength behind the price movement, while a drop shows weakening price movement.

A rise in open interest also indicates that the security is being actively traded, while a decline would show less activity.

The rise in net yen longs was before the dollar rallied against the yen after a strong U.S. jobs report on Friday in its biggest one-day jump since November, 2008, according to Reuters data.

"Dollar strength roiled speculators' bets for a rally in high beta currencies like the euro, sterling, aussie and Swiss franc," said Melvin Harris, market strategist at Easy Forex US Ltd in New York. "The positive correlation between equities,

dollar short foreign exchange and commodities may be starting to disassemble.

"It's not a confirmed trend as of yet but something all traders and investors should be cautious of going into the

early portion of next week," Harris said.

© 2017 Thomson/Reuters. All rights reserved.

   
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Currency speculators increased bets against the U.S. dollar in the latest week to the most since at least June, 2008, according to Commodity Futures Trading Commission data released on Friday. The value of the dollar's net short position rose to $21.8 billion in the week...
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Friday, 04 Dec 2009 04:34 PM
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