From the FXWW Chatroom – MS – EUR shorts remained: EUR was one of only three currencies to see
sentiment deteriorate, staying as the currency that traders are second-most
bearish on. On the other hand, CFTC non-commercial accounts were EUR
buyers, cutting their short positions to the smallest since October 2018. This
was driven by leveraged funds covering shorts slightly while asset managers
continued to liquidate longs. Global macro funds also bought EUR for the
second week, and Japanese retail investors turned from net short to net
long EUR. Short positioning and bearish sentiment suggest EUR may see an
outsized rally should the ECB not meet dovish expectations this Thursday.