Intraday Market Thoughts

Slow Start for USD, Euro Shorts Extend

by Adam Button
Jan 11, 2015 23:41

US dollar traders were whipsawed on Friday as job gains were overshadowed by weak wage growth. Japan is closed for holiday to start the week so early trading is light but the US dollar has continued to slide lower while the kiwi and euro lead the way. Weekly CFTC positioning data showed traders continuing to pile into euro shorts. Both of Premium shorts in CADJPY are in the money, with the first netting +105 pips and the 2nd trade netting +1030 pips. AUDJPY is =in a loss and a AUDCAD was stopped out.

The week ahead will be increasingly about the ECB and Greek election. Mainstream chatter about the ECB decision and its effect on broad risk assets is ramping up and there's a chance of significant disappointment if Draghi fails to deliver. The Jan 25 election is also nearing with polls continuing to show Syriza 3-4 points ahead.

With Japan on holiday, the lone economic data points are Australian home loans and ANZ job advertisements at 0030 GMT. Neither is likely to drive a move in the Australian dollar.

Commitments of Traders

Speculative net futures trader positions as of the close on Tuesday. Net short denoted by - long by +. EUR -161K vs -152K prior JPY -90K vs -96K prior GBP -26K vs -19K prior AUD -49K vs -41K prior CAD -17K vs -14K prior CHF -24K vs -17K prior NZD -1K vs -2K prior

The euro is approaching the most-extreme levels of the past three years. The cycle low was in October at a net short 161K.

Act Exp Prev GMT
Home Loans (NOV)
2.0% 0.3% Jan 12 0:30
ANZ Job Advertisements (DEC)
0.7% Jan 12 0:30

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