A bullish Max Butterfly pattern emerged on GBPUSD 1hr chart
Tuesday, July 8, 2025
Ichimoku Kinko Hyo trade on Japanese cross pairs
We have very strong bullish trend on several japanese cross currency pairs.
Have a look at below charts attached :
CHFJPY Weekly Chart. This pair looks trending very high
EURJPY daily chart.
USDJPY H4 chart. It looks price might get back to the high of 148.00.
GBPJPY Weekly chart. Future cloud change color signalling a bullish run.
Sunday, June 29, 2025
Analysis of Euro FX COT Report (24 June 2025)
Key Observations:
Open Interest (OI) & Market Activity:
Total OI: 762,607 contracts (↑16,746 from prior week).
Number of Traders: 306 (indicating moderate participation).
Dealers (Banks/Market Makers):
Extremely Net Short (Bearish EUR):
Short Positions: 458,976 (60.2% of OI, dominant force).
Long Positions: Only 31,477 (4.1%).
Implication: Dealers are heavily hedging or betting against EUR strength.
Asset Managers/Institutional Investors:
Strongly Net Long (Bullish EUR):
Long Positions: 458,163 (60.1% of OI, largest group).
Short Positions: 120,432 (15.8%).
Implication: Big money expects EUR appreciation, possibly due to ECB policy shifts or USD weakness.
Leveraged Funds (Hedge Funds/CTAs):
Moderately Net Long:
Long: 88,638 (11.6%) vs. Short: 67,545 (8.9%).
Implication: Speculative funds lean long but not aggressively.
Other Reportables & Nonreportables:
Other Reportables: Slightly net long (35,105 vs. 19,596).
Nonreportable Positions (Small Traders): Net long (94,870 vs. 41,704).
Implication: Retail/small traders are bullish, but their influence is limited.
Market Sentiment & Implications:
Divergence Between Dealers and Asset Managers:
Dealers (banks) are heavily short, while institutions are heavily long. This suggests a battle between hedging flows (dealers) and fundamental bets (asset managers).
Historically, extreme dealer shorts can precede EUR rallies if positioning unwinds.
EUR Outlook:
Bullish Case: If asset managers dominate, EUR could rise (e.g., if Fed cuts rates before ECB).
Bearish Risk: If dealers maintain/expand shorts, EUR may face downward pressure (e.g., if EU growth weakens).
Technical Consideration:
High OI + rising longs from asset managers = potential for a short squeeze if EUR breaks key resistance.
Actionable Insight:
Watch for Catalyst: ECB policy signals or US data to determine if dealer shorts cover (bullish EUR) or institutional longs exit (bearish).
Contrarian Signal: Extreme dealer shorts could mean EUR is undervalued, but confirmation (e.g., price breakout) is needed.
Conclusion: The market is split, but institutional bullishness suggests upside potential if macro conditions align.
Analysis of the British Pound COT Report (24 June 205)
Key Data Overview
Open Interest (OI): 179,898 contracts (↑12,872 from prior week)
Total Traders: 108
Contract Size: GBP 62,500
Positioning by Trader Type
Dealer Intermediaries
Net Short: Significant short bias (42,599 short vs. 9,361 long).
Change: Increased short positions by 1,977 contracts.
Implication: Dealers (often banks) are hedging or betting against GBP strength.
Asset Managers/Institutional
Net Short: 78,243 short vs. 64,941 long.
Change: Added 15,005 new short positions (bearish shift).
Implication: Institutional sentiment is turning negative on GBP.
Leveraged Funds (Hedge Funds)
Net Long: 63,501 long vs. 21,817 short.
Change: Increased longs by 1,148 and shorts by 6,984.
Implication: Hedge funds remain bullish but trimmed some exposure.
Other Reportables & Nonreportables
Nonreportable Positions (small traders): Net long (35,906 long vs. 26,266 short).
Other Reportables: Minimal activity (0 long, 4,784 short).
Net Positioning (Long vs. Short)
Dealers: Strongly net short.
Asset Managers: Moderately net short (increased bearishness).
Leveraged Funds: Strongly net long (bullish, but less aggressive).
Small Traders: Slightly net long (contrarian indicator if extreme).
Key Takeaways
Bearish Pressure: Dealers and asset managers are increasing short exposure, signaling institutional skepticism about GBP strength.
Bullish Hedge Funds: Leveraged funds remain net long, but their added shorts suggest caution.
Open Interest Rise: Increased OI alongside price movement would confirm trend strength (data not shown here).
Market Implications
Short-Term: GBP may face downward pressure if institutional shorts dominate.
Contrarian Watch: If leveraged funds unwind longs, GBP could weaken further.
Confirmation Needed: Pair this with price action (e.g., GBP/USD trend) for directional bias.
Actionable Insight
Monitor for:
Price breaking key support (aligned with rising shorts).
Leveraged funds reducing longs (would amplify bearish momentum).
Analysis of the US Dollar Index COT Report (June 24, 2025)
Key Takeaways:
Market Sentiment:
Leveraged Funds (Hedge Funds/Speculators) hold a net short position (11,113 short vs. 10,723 long), suggesting bearish sentiment toward the USD.
Asset Managers/Institutions are also net short (8,738 short vs. 3,421 long), reinforcing a cautious outlook.
Dealers (Market Makers) are heavily long (9,413 long vs. 0 short), which could indicate hedging activity or contrarian positioning.
Open Interest & Changes:
Total Open Interest: 31,225 contracts (↓$84 from prior week).
Leveraged Funds increased short exposure (+41,816 contracts), a strong bearish signal.
Asset Managers reduced longs (↓¥40) while increasing shorts (+2,464), aligning with bearish momentum.
Positioning Breakdown:
Long Dominance: Dealers (30.1%) and Leveraged Funds (34.3%) hold the largest long positions.
Short Dominance: Leveraged Funds (35.6%) and Asset Managers (28.0%) drive the bearish pressure.
Nonreportable Positions (Retail Traders?) are net short (3,554 short vs. 2,840 long), often a contrarian indicator.
Implications for the US Dollar (DXY):
Bearish Pressure: The increase in speculative shorts suggests weakening confidence in the USD.
Contrarian Signal: Dealers' extreme long positioning may indicate a potential reversal if shorts get squeezed.
Watch for: Any shift in Fed policy or risk sentiment that could trigger a short-covering rally.
Conclusion:
The COT report reflects strong bearish sentiment among large traders, but extreme positioning could lead to a reversal if macroeconomic conditions shift (e.g., Fed hawkishness, safe-haven demand). Monitor price action for confirmation.
Gold COT Report (24 June 2025)
Gold COT Report Analysis (24 June 2025)
Key Observations:
- Open Interest & Market Activity
- Total Open Interest: 434,958 contracts (↑ 6,236 from prior week)
- Number of Traders: 310 (indicating moderate institutional participation)
- Positioning by Trader Category
- Swap Dealers (Market Makers & Hedgers)
- Net Short Dominance: 50.7% of open interest (229,728 contracts)
- Significant increase in shorts (+4,174 contracts).
- Longs decreased (-448), suggesting hedging pressure or bearish sentiment.
- Managed Money (Hedge Funds, CTAs)
- Bullish Bias: 37.7% long (163,829 contracts, ↑ 3,817)
- Shorts surged (+41,566), indicating profit-taking or new bearish bets.
- Still net long by a wide margin, but short-covering may be underway.
- Producers/Merchants (Commercial Hedgers)
- Net Short: 14.4% (62,734 contracts, ↑ 1,994)
- Typical hedging behavior, but long positions also rose (+11,253), possibly due to price stabilization.
- Other Reportables & Small Traders
- Other Reportables: 21.2% long (92,248 contracts), 5.1% short (22,372)
- Nonreportable (Retail/Small Traders): 12.6% long, 4.5% short – slightly bullish.
- Net Positioning & Sentiment
- Large Speculators (Managed Money + Other Reportables): Strong net long (256,077 vs. 61,073 shorts).
- Commercials (Swap + Producers): Heavily net short (292,462 vs. 61,902 longs).
- Conflict: Big speculators remain bullish, while commercials (smart money) are heavily hedged/short.
Implications for Gold Prices:
- Short-term: Potential correction risk if Managed Money continues to reduce longs or increase shorts.
- Medium-term: If Swap Dealers unwind shorts aggressively, a bullish reversal could occur.
- Key Levels to Watch:
- Resistance: If gold breaks higher, Managed Money may add more longs.
- Support: A breakdown could trigger further selling from speculators.
Conclusion:
The COT report shows divergence between bullish speculators and bearish commercials. While the net long from funds supports gold, the heavy short positioning from Swap Dealers suggests caution. Monitor price action for a breakout or reversal signal.
Thursday, June 26, 2025
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