Yen Futures Gain Bullish Traction, Bears Weigh on EUR/USD: COT Report

The Commitment of Traders (COT) report provides insights into the positioning of large speculators, asset managers, and hedge funds in the futures market.

Key Findings

• Large speculators increased gross-longs to yen futures by 23% and also increased gross-shorts to EUR/USD futures by 18%.
• Asset managers remained net-long GBP/USD futures but reduced gross longs by 15%.
• Short interest against NZD/USD futures increased by 16%.
• Traders increased net-long exposure to the USD by $5.6 billion, reaching a 20-week high.
• Large speculators remain net-short on USD for a second consecutive week.

Yen Futures (JPY/USD)

The yen fell over 10% from September to November, but momentum has waned. Both asset managers and large speculators increased longs and reduced shorts last week, suggesting a possible swing low for the yen.

EUR/USD

Large speculators increased their net-short exposure for the first time in three weeks, and asset managers reduced their net-long exposure. Speculative volumes have been trending lower, potentially indicating a shift to net short positions.

Conclusion

The COT report provides mixed signals for the yen and the euro against the US dollar. The yen may have reached a swing low, while the euro remains under pressure from bears. Traders should monitor these positions closely, as they could influence market sentiment and price movements.