EUR shorts increased, GBP shorts trimmed

According to the IMM net speculators’ positioning as at April 9, 2019, speculators increased their bearish bets on the euro further with short positions rising to the highest level since early December 2016 in early April, notes the research team at Rabobank.

Key Quotes

“While at this stage short EUR does look like a pain trade as EUR/USD has been trading relatively well so far in April, the bearish view on the single currency is still valid.”

“Essentially, the Eurozone continues to underperform the US economy by a mile and the interest rate differential is skewed firmly in favour of the dollar as reflected in an increase in USD net long positions to the highest level in four weeks. Looking further ahead, EUR/USD is likely to lean lower in the coming months with 1.10 as our 6-9 month target.”

“GBP net shorts have been trimmed further to the lowest level since June 2018.”

“With speculative positions almost neutral, market participants can keep their powder dry for next sharp move in GBP/USD. The pair is stuck between the upside trendline from the December low and the trendline resistance from the March high. In the coming days/week cable will approach an inflection point, i.e. it will break from this consolidation phase.”

“Fading market concerns about global slowdown led to a further rise in JPY net short positions. This coincided with a recent rebound in USD/JPY which has reached a crucial technical pivot: the resistance area formed by the Nov/Dec lows around 112.24 level and the March high at 112.14. This area must be cleared to improve the technical outlook for USD/JPY, which provides clues for other asset classes as well, including emerging markets.”

Share: Feed news

Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.

If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.

FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.

The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.