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Net Euro Speculative Positions Hit All Time Record Of -71,623, A Massive 20% Increase In Short EUR Exposure (Commitment Of Traders)
Despite expectations elsewhere that speculators may be unwind their Euro short exposure, the CFTC's Commitments of Traders report indicated that for the week ended February 23, futures only speculative shorts hit an absolute all time record of -71, 623, an increase in net short exposure of over 12k compared to the Feb 16 position of -59,422, a massive 20% week over week increase. Another observation: the fans of the JPY are declining materially, with net longs collapsing by 12,195 positions, to just above breakeven, at 1,717. The GBP was the second most hated currency in the past week, with a net positioning of -64,647, an increase in net shorts of 5,409 weekly. The only currencies, which saw net long positions were the AUD (+11,989 to 38,992 and the CAD 4,996 to 28,421), and, of course, the dollar, whose aggregate positioning in nominal terms increased by 20%: from $8.14 billion to $10.28 billion.
Key moves represented graphically:
Charts via Morgan Stanley
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Where's Master Bates. I'm selling a kreugerand Monday and I need him to come argue against gold and drive the price up to 1150 by monday.
I sold a 10 oz silver friday as i finally needed some cash.
Except for milk bread and eggs we arent buying and wont for a long time.
that's pretty funny. lol... i want him to be right so i can buy more krugerrands on the cheap. unfortunately, i'm thinking he won't read these posts since he's only drawn to certain articles/blogs where he can rattle some cages.
AND ultimately that means, time to go !!!!LLLLOOOONNNNGGGG!!!!
Of course! It's obvious! Unless you're wrong! Happy trading!
+1
1. Either the smart money knows the Euro is in for a world of hurt due to the oft discussed problems or
2. There are too many people on the same side of the boat that will capsize
3. Or both or
4. Goldman will squeeze the hell out of the Euro shorts and clean up by being long the stock market and commodities as a rising Euro propels the latter skyward. I think Goldman will do G-ds work and squeeze the Euro shorts.
Same movie different currency.
http://bit.ly/9Nqq7U
Very interesting.
Just like Buffett trying to find his last 'mammoth' capital deployment (see: Burlington Northern), Soros may be looking for his last 'mammoth' currency squeeze (see: Euro).
Legacy builders, when they get up in age, seem to always want to make that last big move before the final curtain call.
Short the Euro they will for another week or so, but it ain't working so they will have to move to the other side of the trade very soon. Soros is firing blanks. I wonder if he knows. He also says he does not like the Doelarr, he likes SDRs. I think he just simply hates life. Crazy old man.......
"I think he just simply hates life."
i think that's a very astute observation.
If he did, he wouldn't be a billionaire.
Exactly,
After Fame, and Buku dinkey dong cash$$$$$$$$$$, what's left for the UBER RICH?.
Only one thing, since dawn of time..............
P_O_W_E_R_.
Or, this could be a side effect of record short interest in USD shifting back towards risk currencies. That would mitigate the perception of EUR being oversold. Just sayin'....
Clearly it’s always scary when everyone is on one side of the boat like this BUT sugar DID go to 1 cent/lb some years ago and it looked like a great long many times before that!
So the net is a swing to the dollar of $18b? That is a rounding error.
I was wondering about that myself. In a trillion-dollar per day market, that is really not a gigantic signal.
One man's trash is another GS's treasure! Go against the herd I say.
i agree. the japanese yen rallied throughout their stock market collapse and still is technically in a long term bull market.
the bull market for the USD just began. we will see the USD rise for the next two years at least. people seem to forget that the USD has been in a bear market for nearly 3 decades.
however, near term the Greece bailout will drop the USD back to the 50 day MA or possibly as low as the 200 day MA. the stock market will likely re-visit 1150. after that it is gravy train time for the USD, and doom for the stock market.
gold may not drop that much, but it will drop. oil will drop precipitously back toward the long run average of $20-30/barrel.
Oil at an average 20-30$ barrel? How so?
your wrong on the dollar and your wrong on oil too.....the dollar being in a bear market for 3 decades has no bearing on its current and future position..the dollar bear market wont end until its dead..ben will guarantee that..you're not seeing the whole picture..
You nailed it.
The major currencies are rotating through short-term periods of weakness. First was the dollar, then the Euro. Next comes the yen. (I don't know that any of this is orchestrated by global central banks but it certainly is a possibility...)
When this rotation and the echo ramifications settle out in a couple of years, the USD will move into bull market territory and could very well rally for years to come against all the majors, especially the Japanese yen. All this while our stock market goes through the spin cycle, squeezing out all this liquidity.
It is going to be interesting.
Oh' & another thing...in these sado-masochistic markets max pain always wins out
great article in today's wsj about the hedgies (soros people, einhorn, sac, a few others) having a tony little dinner at a M'tan townhouse recently discussing the demise of the euro and shorting it.....one of the lottery tix was some 1 yr put of some sorts that the euro would go to 1:1 with the greenback....don't have link, read the actual paper version.
Good Golly Andy, see anything familiar? Merrily we rhyme along.
'As mass production has to be accompanied by mass consumption, mass consumption, in turn, implies a distribution of wealth -- not of existing wealth, but of wealth as it is currently produced -- to provide men with buying power equal to the amount of goods and services offered by the nations economic machinery. Instead of achieving that kind of distribution, a giant suction pump had by 1929-30 drawn into a few hands an increasing portion of currently produced wealth. This served them as capital accumulations. But by taking purchasing power out of the hands of mass consumers, the savers denied to themselves the kind of effective demand for their products that would justify a reinvestment of their capital accumulations in new plants. In consequence, as in a poker game where the chips were concentrated in fewer and fewer hands, the other fellows could stay in the game only by borrowing. When their credit ran out, the game stopped.That is what happened to us in the twenties. We sustained high levels of employment in that period with the aid of an exceptional expansion of debt outside of the banking system. The time came when there were no more poker chips to be loaned on credit. Unemployment further decreased the consumption of goods, which further increased unemployment, thus closing the circle in a continuing decline of prices.This then, was my reading of what brought on the depression.'
-Marriner S. Eccles
'Other than Herbert Hoover’s memoirs, I have yet to read any analysis of the Great Depression attribute anything internationally other than the infamous US Smoot-Hawley Act setting in motion the age of protectionism in June 1930. It was the financial war between European nations attacking each other's bond markets openly shorting them that led to all of Europe defaulting on their debt. Even Britain went into a moratorium suspending debt payments. This is what put the pressure on capital flows sending waves of capital to the United States that to some degree was kind of like the capital flow to Japan into 1989. This put tremendous pressure upon the dollar driving it to new record highs that were misread by the politicians who did not understand capital flow. They responded with Smoot-Hawley misreading the entire set of facts.'
-Martin Armstrong
not that I'd cry any tears for the Euro, but why does the idea of hedgies hanging out, eating their fancy meal and making bets about world currencies make me sick....I know Soros got rich on Asia...but who got poor when he got rich...
Soros got rich shorting the Great British Pound Sterling.
My hunch is that it was NOT the Euro they were discussing. Saying "Euro" over and over seems an amateurish game of disinformation. Soros is quite secretive about which currencies he holds and in which direction he is betting. Couple this with Jim Rogers coming out last week and saying that the GBP could completely collapse within a couple of weeks and a massive move against the Cable seems more likely.
The EUR/GBP chart shows that a massive upside move from here is quite possible.
Rogers calling the GBP a sell was a setup by some douchbag from alphaville, he has denied it.
Orly are you still short the EUR/USD?
That's the best reason to go long I've heard yet. You KNOW they're doing the exact opposite of whatever is in their little planted article.
Of the topic - but Marla... Where's radiozero?
So all those "guro hedge fund managers"are talking recently about what we were discussing here on ZH since god knows when?. And they get to make the millions and billions,while I am sure that most people here at worse hardly get by,or at best are a part of a continously dwindling middle class. What an irony...
Making such bets is very hard to do with your own money. Particularly if the result of being on the losing side means you eat dog food for your retirement.
However, if you are betting other peoples money and your own personal downside risk is close to nil, then why not bet the farm?
That's the primary difference between hedge fund managers and the folks here reading ZH.
Stupid fundsters will be punished when an "unexpected" Greece bailout (sorry, direct purchase of Greek gov. bonds) is announced by Deutsche bank (which is probably hugely short DXY), oh and, it happens to be the World's largest currency trader by the way....
Keep dreamin.
70k contracts are not even a drop in the bucket for the EURUSD, the deepest FX cross. This has very little if any significance for actual trading.
But this is most likely indicative of what is happening in the broader FX market.
More analysts should use technical analysis as it's a leading indicator and tells us where the economy is headed.
The proprietary indicators I use in my technical analysis can identify trend changes before they occur.
In early 2007 I warned of an impending stockmarket crash.
I confirmed an equity bottom by early April 2009.
From mid 2009 onwards I warned of an impending USD rally and EURO weakness.
The uptrend since March 2009 has been a bear market rally contained within a much larger downtrend that started in 2000.
http://www.zerohedge.com/forum/market-outlook-0
In the spirit of your avatar, this ain't your daddy's cycle...
At this point at the end of the trend - 2009 low besting the 2002 low breaking a line of lower lows from 1897 up- our prosperity is now in the hands of Fleck's battle of unarmed combatants (currencies) where the U.S. is the dealer
Of course it ain't our Daddy's cycle, duly noted AM--it goes back hundreds of years. Back to the COT report, it will probably soon hit a short term bottom in the next few weeks, retrace a bit, and then shorting the Euro will continue with a fury.
The Euro going to par with the USD makes perfect sense and it will, over time. I doubt it will exist at all in 5 years and I made that prediction at inception--15-20 years max due to the conflicting natures of the economies and the growth/debt limitation requirements for all that wanted to play in the Euro sandbox.
It's only a matter of time. My concern is that the bullishness going towards the CAD and Aussie will destroy those particular countries. Canada does not want a strong CAD as an export nation. As of last week they even became net exporters of natural gas. A strong CAD is great for their overtaxed consumers and the country is far more sane than the US in many ways, but they faired far worse in the depression and will do the same when the next leg down comes. Simple supply/demand stuff. It's great to have natural resources but it is of little help when there is no one to buy them.
And anyone who buys the China's still going to grow story when the ensuing meltdown gets seriously underway needs a bottle in front of them for when I arrive to perform a frontal lobotomy to remove what little is left of their brain.
So for the perfect storm on a global level to occur as I see it to complete the Grand Supercycle--the Euro contagion will continue, the banks in this country will continue to fail, Great Britain will collapse, China will stumble big time as global demand for their crap disappears, the November elections will bring in a gang that refuses to continue bailouts and stimulus will be questionable by that point as well, U/E will double from here, and all the kings horses and all the kings men will not be able to put humpty dumpty back together again akin to the world as we know it.
Gee, and I was feeling so great when I sat down at the puter after knowing full well that the tsunami would never hurt Hawaii because global rubbernecking via the web made it so. After all, that is what Hollywood is for and as much as the world wants to watch a catastrophe live, they only really get that action watching financial markets meltdowns.
and the bearish case would be what?
LOL!
And we are all so proud of you.
I also like the oracle of fifi.
Thanks for the heads up.
WSJ article today that hedge funds have been lining up to put this trade on, with some of them gunning for parity between the USD and the Euro.
The EUR would be grossly undervalued if it drops to 1.00. If it happens over the next 1-2 years, then likely only for a blink.
Now, remember what happened when we read the same stories about the dollar? Mr Market lives to inflict the most pain on the most people.
Dollar to 89 and then crash. In a massive bear flag. Eventual target looks to be somewhere in the 50's.
http://stockcharts.com/def/servlet/Favorites.CServlet?obj=ID3186525&cmd=...[s189900700]&disp=P
EUR might be on Sale with a good discount...
France, Germany to help Greece raise money: report
ATHENS (Reuters) - Germany and France have agreed to help Greece sell bonds in return for stronger efforts by Athens to slash its budget deficit, Greek newspaper Ta Nea reported on Saturday, citing unnamed sources.
http://www.reuters.com/article/idUSTRE61Q1CS20100227
Bailing out Greece is goodfor Greece, but why is it good for the euro? This will just extend the inevitable dismissal of some of the PIGS ou of the eurozone. Buying Greek bonds which will most certainly be defaulted on( no economy And civil distress)is just bad quantitative easing. Those are junk bonds we are talking about. And if the Eurozone is sucking in toxic Greecey debt then the whole myth that the euro is a better managed currency is moot. I suspect a bailout just meansthe euro tanks after a nearterm rebound when people figure out where that inevitably leads. Infinite money for infinite problems.
California is a greater risk than Greece, warns JP Morgan chief
http://www.telegraph.co.uk/finance/financetopics/financialcrisis/7326772/California-is-a-greater-risk-than-Greece-warns-JP-Morgan-chief.html
This completely misses the point. Listed currency futures comprise a tiny tiny portion of the market. Heck, it could have been long or short 500% more or shown no market bias whatsoever. OTC comprises the entire market.
It's the same as saying, "my cousin told me that his buddy sold his house 20% above market, therefore, the broad housing market is 20% higher!"
Ok maybe this is how it play?
Euroshorts get a carrot with Greek bailout. Euro drops on monetization of Greek debt.
Goldman positions with the shorts and then with insider trading goes short USD before the FED announces quantitative easing 2. Dollar plummets-euroshorts squozen and euro jacks up. Goldman will of course be long euro. Just saying...
One headline to rule them all:
"Reversion to mean to be avoided."
We all know how that works out. I feel a little better about my tiny open long EURUSD position now.
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