Last Friday, Commitment of Traders (COT) most recent weekly data reported by the Commodity Futures Trading Commission (CFTC) presented large numbers of Forex traders and speculators pulling back on their overall bullish bets after three straight weeks’ rise bringing the bullish levels to the greater height after since the middle of 2013.
According to non-commercial large futures traders, hedge funds and large speculators, as of Thursday, CFTC’s latest report and Reuter’s dollar amount calculations, US dollar has an overall position totaling $31.63 billion.
The weekly change of -$4.25 billion based on calculation of Reuters from the $35.88 billion total long position that was registered on September 2nd. It totals the contracts of green bucks against the overall contracts of all monetary currency as Australian dollarD, British pound, Canadian dollar, euro, Japanese yen and the Swiss franc.
Gross US dollar bullish position had been gaining for three straight weeks and for the last six out of the previous seven weeks before it started to retreat last week’s positions. USD index has achieved its highest level starting July of 2013 when it leaped over the threshold of 84.00 this week.
The common currency increased against the US dollar following the circulation of optimistic retail sales data from the United States.
However, profits were expected to be stable in the midst of speculations that the US will jack up interest rates earlier than usual.
The EUR/USD currency pair was recorded at 1.2955 during afternoon trading in European stock markets.
The pair later strengthened at 1.2952and grew 0.23%.
It will probably find support at 1.2858.
Official data revealed that retail sales in the US went up 0.6 percent in August. This is in accordance with market expectations. Retail sales in July showed a 0.3 percent gain from an approximate flat reading.
This data was publicized in the wake of hopes for an early increase of interest rates in the country.
The Federal Reserve is expected to reduce its asset purchase program by $10 billion during the next policy meeting.
Official data also underscored that production in the euro zone industrial production grew 1.0 percent in July. This surpassed expectations for a 0.5 percent gain after falling 0.3 percent three months ago.
Reactions on the euro varied after the ECB reduced rates across the euro zone last week.
The recent opinion’s polls indicate that the yes campaign is losing a bit of thrust over the last two days. Meanwhile the pound is regaining some of its missing ground overnight since the “Team Westminster” has ultimately acted together in an opinion poll. The Daily Record returned the negative votes back in the lead achieving 53% of voters that had given their decision.
The Royal Bank of Scotland and Lloyds spoke of their emergency plans to move to England if the positive vote is successful. It seems that the monetary insinuation of quitting the union is starting to strike on Scottish voters. The Vote will be out by next Thursday an expectation of volatility is still in the currency markets and sterling is influenced by the shifts in opinion polls awaiting the results.
The USD is strengthened by the US Fed discussing an interest rate increase that pressured the pound lower. The improving US economic data pushed down the GBP/USD that in turn pressed on the GBP crosses. The Yes voters of Scotland hope to make history during independence vote of next week that will clearly make the pound weaker.
Two advantages seen this week are: (1) a Scottish poll was No vote 5 pts ahead that the pound found immediate buyers; and (2) poor Chinese data upstaged the stronger Aussie employment figures. If the yes votes win – the GBP will plummet; if a No vote wins – the pound will be supported.
The Fed’s move to increase interest rates may have caused government bonds to decline while the Russian currency toppled to an exceptional low in the midst of fresh restrictions.
The Aussie dollar was among higher-yielding currencies that dropped.
The ten-year yields in Germany increased by three foundation points to 1.1 percent at the New York stock market. Meanwhile, rates on parallel maturity treasuries reached a six-week peak of 2.58 percent.
STOXX Europe (600 Index) moved forward 0.2 percent. It broke a five day succession of losses while the index for US equities hardly moved.
On the other hand, up-and-coming market stocks waned for seven consecutive days after lending data from China trailed valuations.
The Australian currency went down by 0.6 percent to less than one US dollar. This was the lowest dating back to March 24.
US retailer sales rose 0.6 percent last month which was the quickest tempo during the last four months. This heightened potentials for high-level borrowing costs. ECB President Mario Draghi is scheduled to meet with euro zone finance ministers in Milan as the EU looks to implement more restrictions against Moscow.
The list of sanctions includes 15 multi-national firms.
There is a 60 percent probability that the Federal Reserve will boost its benchmark by July of next year. Meanwhile, yield on Treasuries expected within the next 10 years went up by climbed 10 basis points which were the highest since last month.