Commitment of Traders

While the 0.001% of the world dine together and plan their next moves, here are the main events in the week ahead.  

Yes the US does not practice laissez faire capitalism.  It never did.  It manipulates sets intersest rates.  The fx market is still understandable and the dollar is moving higher.

There may be one great conspiracy dictating the course of the capital market, but if there is not, what is the near-term outlook for the dollar?  

Just one guy's attempt to make sense of what is likely to happen in the coming days.

Overview of the technical outlook for the major currencies, bonds, Treasuries, stocks, CRB and oil.

Outlook of the foreign exchange market in the week ahead, with some observations about equities and bonds.

A look at the price action in the major currencies, US Treasuries and the S&P 500.   

Near-term outlook for the dollar, without resorting to inflammatory and unproven claims.

Overview of the price action in the forward exchange market and a look ahead.  

Dispassionate overview of the price action in the foreign exchange market in the context of the funamental developments.    

An overview of the price action in the FX market and a look at US 10-year yields.  No ride on an ideological hobbie horse or axe to grind.  Just trying to make sense of the price aciton

On the day after Chairman Yellen’s press conference, investors aggressively bid up inflation trades across numerous asset classes. Gold and silver rallied sharply, TIPS implied inflation breakevens widened (despite a new slug of 30-year supply), Treasury yields rose, and the yield curve steepened. Based on investor positioning and market sentiment (CFTC’s Commitment of Traders data show record net short positions exceeding $1.5 trillion in notional rates exposure among speculators in the eurodollar futures markets), there’s decent potential for additional gains in these inflation expressions in the days and weeks ahead.

A look at the likely price action in the forex market in the week ahead.

We have shown the surge in short positioning that CFTC exposes via its Commitment of Traders data that has begun to see some covering; but despite Citi's protestation that the recent rally in bonds 'must' have cleared out the short base and squared positions, the truth is - the Treasury market is dominated by more than just futures and institutional clients have not been this short Treasuries since 2006. As JPMorgan's Client Survey exposes, as of the end of last week, active clients were adding to shorts... which could be a problem as the last time all clients were this net short, bond yields collapsed in the next few months...

Dispassionae look at the several events in the week ahead.