Speculative Shorts on GBP Continue to Rise: CFTC Positioning Report

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Written By: Eno Eteng (MSTA)
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    Summary:
  • The CFTC Commitment of Traders (COT) report indicates that net speculative short positions on the GBP are rising due to fears of a "no-deal" Brexit.

The latest Commitment of Traders (COT) report from the Commodities and Futures Trading Commission (CFTC) has been released. According to this CFTC Positioning report for the week which ended on August 6, speculative short positions on the British Pound have continued to increase. As a result, net shorts on the GBP have risen to their highest levels in 52 months, as traders gear up for a possible no-deal Brexit on October 31 as well as underwhelming economic data from the UK.

With lingering global economic uncertainty arising from the US-China trade war, the CFTC Positioning report unsurprisingly noted that the net of speculative positions on the Japanese Yen (JPY) are now long; the first time that this has happened since late 2016.

Net positions on the Euro continue to be short, but these have scaled back to the lowest levels in 2 weeks as the markets have increased the odds of another rate cut by the Fed before year end, while there is still a lack of consensus on any easing activity by the European Central Bank.

The report also indicates a rise in the net speculative shorts for the Swiss Franc, but levels are still lower than the average for the year. The report also indicates a rise in AUD net shorts for the second week in a row. As a commodity currency which is inherently tied to China, the AUD is being impacted by economic conditions that arise from the US-China trade war.

Written By: Eno Eteng (MSTA)

Eno is a certified financial technician and member of the UK Society of Technical Analysts. He loves to trade and write about stocks, Forex, and CFDs. Since 2009, he has consulted several financial companies as a trader and strategy developer. His work can be seen on several forex blogs and trading educational websites.

Published by
Written By: Eno Eteng (MSTA)