Last week’s data from the CFTC on IMM positioning showed that leveraged names had turned big sellers in EURUSD, with the net short increasing to EUR13.1bn in the week to August 5.
Looking at our flow over the past 30-days and 6-months supports the notion that the market is very short. The net short is across all client segments is close to its largest it has been over the past 6-months.
Over the past 7-days, the picture is less clear and flows have generally been contrarian, suggesting many players are happy to trade the range.
Drilling down into our leveraged flow also supports the notion that this sector is running a large short. However, leveraged names have turned net buyers over the past 30-days, which is perhaps one reason why the market has stalled.