This latest report on FX market speculative positioning is for the week to March 2nd:
- Long USD positions were smashed by over 75%
- This was primarily achieved through a big increase in JPY longs ie USD/JPY selling
- AUD and CAD buying continues, though still in moderation
- The record EUR shorts from previous week were reduced by a little over 5%
It looks like the market decided to transfer a significant portion of it’s short EUR/USD positions into EUR/JPY positions through the selling of USD/JPY. These look to have been spooked by the ‘war-chest’ proposal from the Japanese government and therefore we had the big spike in USD/JPY and in the JPY crosses on Friday. Short term speccies forced to cover, as usual the biggest driver in the FX market.
