We have strong Braintrend Signal trade during NY Session.
Tuesday, October 14, 2025
Wednesday, October 8, 2025
8th Oct 2025 Bank Of New Zealand Cut OCR
Here are some charts that show exchange rates reaction after Bank of New Zealand cut OCR from 3.00% to 2.50%.
Monday, October 6, 2025
BrainTrend System Chart 6th Oct 2025
Some example of today's braintrend signal happened on some currency pairs.
Sunday, October 5, 2025
Dollar Index Future COT Report 23rd Sept 2025
Overview of the COT Report
The Commitments of Traders (COT) report for USD Index futures (ICE Futures US, contract size: US Dollar Index × 1,000, CFTC Code #098662) as of September 23, 2025, provides a snapshot of positioning in the market. This data is released weekly by the CFTC and reflects positions as of the preceding Tuesday (September 23 in this case). Key headline figures:
- Total Open Interest (OI): 40,441 contracts (+1,915 week-over-week, or +5.0%, indicating increased market participation and potential building conviction).
- Total Traders: 117 (stable, suggesting steady involvement from major players).
- Market Sentiment Tilt: Speculative categories (Asset Managers, Leveraged Funds, Other Reportables, and Nonreportables) are collectively net short by approximately 18,383 contracts, while commercials (Dealers/Intermediaries) remain heavily net long by 18,675 contracts. This classic "commercials vs. specs" divergence often signals contrarian potential, with commercials (hedgers) positioned bullishly against specs (trend-followers betting on USD weakness).
The report shows a modest increase in OI driven by additions across most categories, but with mixed directional changes. Speculative shorts eased slightly in Leveraged Funds (less aggressive bearishness), but Asset Managers added to their short bias. Below, I'll break down the data, net positions, changes, and implications.
Positions by Trader Category
Here's a cleaned-up summary table of non-spreading positions (longs and shorts), spreading positions, and their share of total OI. Changes from the prior week (September 16, 2025) are noted where discernible from the report; positive changes in green, negative in red.
| Category | Long Positions | Long % of OI | # Long Traders | Short Positions | Short % of OI | # Short Traders | Spread Positions | Spread % of OI | # Spread Traders | Net Position (Long - Short) |
|---|---|---|---|---|---|---|---|---|---|---|
| Dealer Intermediary (Commercials/Hedgers) | 18,675 | 46.2% | 5 | 0 | 0.0% | 0 | 0 | 0.0% | 0 | +18,675 |
| Change | -157 | - | - | 0 | - | - | 0 | - | - | -157 |
| Asset Manager/Institutional (Large Specs) | 2,018 | 5.0% | 9 | 11,166 | 27.6% | 18 | 1,979 | 4.9% | 4 | -9,148 |
| Change | +483 | - | - | +1,183 | - | - | N/A | - | - | -700 |
| Leveraged Funds (Hedge Funds/Specs) | 11,700 | 28.9% | 18 | 16,912 | 41.8% | 30 | 879 | 2.2% | 4 | -5,212 |
| Change | +1,327 | - | - | +633 | - | - | +23 | - | - | +691 |
| Other Reportables (Mixed/Others) | 2,441 | 6.0% | 16 | 5,725 | 14.2% | 21 | 44 | 0.1% | 0 | -3,284 |
| Change | +327 | - | - | +138 | - | - | -55 | - | - | +189 |
| Nonreportable Positions (Small Traders) | 2,785 | 6.7% | N/A | 3,736 | 9.2% | N/A | 0 | 0.0% | N/A | -951 |
| Change | -71 | - | - | +320 | - | - | 0 | - | - | -391 |
| Totals | 37,619 | 92.9% | 48 | 37,539 | 92.8% | 69 | 2,902 | 7.2% | 8 | Commercials +18,675; Specs -18,383 |
Notes:
- Percentages sum to ~100% across non-spread longs (~92.9%), non-spread shorts (~92.8%), and spreads (~7.2%), as spreads count toward both sides of the market.
- Minor discrepancies in totals (e.g., longs at 37,619 vs. shorts at 37,539) are due to rounding in the original report.
- Net positions exclude spreads, as they are market-neutral (each spread contract is simultaneously long and short).
Long vs. Short Breakdown (Visual Summary)
The report includes stacked bar charts emphasizing the long/short balance:
- Overall: Shorts dominate in speculative categories (red bars larger in Asset Mgr, Lev Funds, Other, Nonrep), while Dealers show a pure green long bar.
- Key Visual Insight: The speculative side's short skew is evident, but the OI surge suggests fresh capital entering—potentially specs doubling down or commercials defending their long bias.
| Category | Long Stack (Green) | Short Stack (Red) |
|---|---|---|
| Dealer | 100% Long | 0% Short |
| Asset Mgr | ~15% Long / 85% Short (incl. spread) | |
| Lev Funds | ~40% Long / 60% Short | |
| Other Rep | ~30% Long / 70% Short | |
| Nonrep | ~43% Long / 57% Short |
Key Changes and Trends
- OI Expansion (+1,915): Driven primarily by Leveraged Funds (+1,327 long +633 short +23 spread = +1,983 net addition) and Asset Managers (+483 long +1,183 short = +1,666 net). This points to heightened interest, possibly tied to volatility in FX markets (e.g., Fed policy expectations or global risk-off flows around late September 2025).
- Directional Shifts:
- Bullish Signals: Leveraged Funds reduced their net short bias (+691), hinting at some covering or profit-taking on prior dollar weakness. Other Reportables also trimmed shorts slightly (+189 net).
- Bearish Signals: Asset Managers piled on shorts (+700 net deeper), aligning with institutional caution on USD strength. Nonreportables turned more bearish (-391 net), often a retail "crowd" indicator.
- Commercial Stability: Dealers trimmed longs modestly (-157), but their massive net long remains a anchor—hedgers (e.g., exporters) likely locking in gains amid dollar rallies.
- Trader Concentration: Low trader counts in Dealers (5 longs) vs. higher in specs (e.g., 30 short in Lev Funds) suggest concentrated bets, increasing risk of sharp reversals if triggered.
Market Implications and Sentiment
- Speculative Bearishness on USD: Large specs (Asset Mgr + Lev Funds) hold a combined net short of ~14,360 contracts—the most bearish since mid-2025 peaks. This reflects bets on USD depreciation, possibly driven by anticipated Fed rate cuts, softening US data, or euro/yen strength. Historically, extreme spec shorts in the Dollar Index have preceded bounces (e.g., Q4 2024 reversal from -20k net short).
- Commercial Counterweight: The Dealers' +18,675 net long is a strong bullish contrarian signal. Commercials often "win" in COT dynamics, as they hedge real flows (e.g., US import/export imbalances). If specs are overextended short, this setup favors a USD rebound—watch for OI to stabilize or specs to cover.
- Broader Context: With OI at multi-month highs, the market is "hot" but imbalanced. Volatility could spike if geopolitical events (e.g., US election noise) or data (e.g., October NFP) shifts sentiment. Short-term: Mildly bullish USD on spec fatigue. Medium-term: Monitor next week's report (Oct 1 data) for spread unwinds or further Lev Fund covering.
- Risks: Low liquidity in some categories (e.g., 0 Other spread traders) could amplify moves. Always cross-reference with spot DXY levels (~102-104 range in late Sept 2025) and correlated assets like 10Y yields.
Disclaimer: This analysis is for informational purposes only and should not be considered investment advice. The COT report is a lagging indicator, reflecting positions from the previous Tuesday.
Wednesday, September 17, 2025
EURAUD and EURCAD Exchange rates moves 16th Sept 2025
This two currency pairs moves a lot after CAD CPI news released.
EURCAD moves pass above 100% average range.
EURAUD moves pass above 125% average range.
Sunday, September 14, 2025
Japanese Yen Future COT Report As of 9th Sept 2025
Executive Summary
The COT report reveals an extremely bearish market sentiment towards the Japanese Yen. The market is heavily net short, a position overwhelmingly driven by Dealers, who are typically considered the "smart money." This suggests strong institutional expectation for further Yen weakness. However, a significant build-up of long positions by Asset Managers provides a notable counterweight, indicating a fundamental divergence in views between major player types.
1. Key Overall Metrics
Open Interest: 410,799 contracts (an increase of 3,450). This rise in open interest alongside price movement (typically down, given the net short position) can often signal a strengthening of the prevailing bearish trend.
Number of Traders: 141. This indicates a highly institutional market.
2. Analysis by Trader Group
Dealers (Typically Banks & Dealers) - The "Smart Money" is Extremely Bearish
Position: Massive Net Short.
Long Positions: 53,701 (13.1% of OI)
Short Positions: 204,972 (49.9% of OI)
Net Position: -151,271 contracts (Net Short)
Analysis: This is the most significant takeaway from the report. Dealers hold nearly four times as many short positions as long ones. They increased their net short position significantly by adding 16,568 new short contracts. This group's extreme positioning is a powerful bearish signal for the Yen.
Asset Managers / Institutional - The "Fundamental Money" is Bullish
Position: Strong Net Long.
Long Positions: 118,215 (28.8% of OI)
Short Positions: 32,362 (7.9% of OI)
Net Position: +85,853 contracts (Net Long)
Analysis: This group holds a strong bullish conviction, acting as the primary counterforce to the Dealers. They added a substantial 38,906 long contracts. This suggests they believe the Yen is fundamentally undervalued or due for a reversal, likely based on macroeconomic factors (e.g., potential Bank of Japan policy shifts, valuation models).
Leveraged Funds (e.g., Hedge Funds) - Bearish, but Reducing Exposure
Position: Net Short.
Long Positions: 41,473 (10.1% of OI)
Short Positions: 83,135 (20.2% of OI)
Net Position: -41,662 contracts (Net Short)
Analysis: Leveraged funds are bearish but notably reduced their net short position during the week. They covered 10,778 short contracts and also sold 16,600 spread positions (which often implies closing out bullish spread bets). This "short covering" can provide short-term support for the Yen and may indicate a cooling of the most aggressive speculative bearish bets.
Other Reportables & Nonreportables
Other Reportables: Hold a very large net long position (98,700 vs 419), but this is likely a single or a few large entities and is less indicative of broad sentiment.
Nonreportable Positions (Small Speculators): Are net long by 8,799 contracts. Historically, small speculators are often on the wrong side of the trade, so their net long position subtly reinforces the bearish outlook.
3. Market Sentiment & Implications
Dominant Sentiment: Bearish. The market structure is defined by the colossal net short position of the Dealer group.
Market Divergence: A classic "battle" is set up between the deep-pocketed, often well-informed Dealers (net short) and the fundamentally-driven Asset Managers (net long). The Leveraged Funds are caught in the middle, currently siding with bears but showing signs of pulling back.
Price Outlook:
Short-Term: The dominance of Dealers suggests the path of least resistance is down. Further Yen weakness is possible.
Medium-Term: The large net long position of Asset Managers represents significant buying power. If their fundamental thesis (e.g., a hawkish BoJ pivot) plays out, they could fuel a powerful short-covering rally. The Yen has potential for a sharp rebound if market catalysts change.
4. Key Changes from the Previous Week
Dealers became more bearish (added shorts).
Asset Managers became more bullish (added longs).
Leveraged Funds became less bearish (covered shorts and closed spreads).
This shows the bearish and bullish bets are both getting larger, increasing the potential energy in the market for a significant move once one side capitulates.
Conclusion
The JPY futures market is poised for high volatility. The current setup is dominated by strong bearish commercial hedging or speculation (Dealers), but is facing equally strong bullish fundamental conviction (Asset Managers). The market is heavily net short, but the largest speculative group (Leveraged Funds) is starting to reduce its bearish exposure. This creates a environment where the Yen is vulnerable to further selling, but also primed for a violent rally if the fundamental outlook shifts or if Dealers begin to take profits on their massive short positions.
Disclaimer: This analysis is for informational purposes only and should not be considered investment advice. The COT report is a lagging indicator and reflects past positioning.
EuroFX Future COT Report As Of 9th Sept 2025
Overall Summary
This report reveals a market with an extremely strong and concentrated bearish sentiment towards the Euro, primarily driven by Dealer positions. However, this is heavily countered by significant bullish positions from Asset Managers. This creates a market characterized by a major standoff between two powerful player groups.
1. Key Market Snapshot
Open Interest: 878,184 contracts (very high, indicating strong liquidity and interest).
Net Change in OI: +137,284 contracts (a significant increase, suggesting many new positions were opened this period, adding to market activity and potential volatility).
2. Analysis by Trader Group
Dealers (Typically Banks & Dealers)
Position: Extremely Net Short
Long: 47,377 (5.4%)
Short: 513,816 (58.5%)
Net Position: -466,439 contracts
This is the most striking feature of the report. Dealers are massively short the Euro. A net short position of this magnitude (over half a million contracts) often represents hedging activity against client long positions in the OTC (over-the-counter) market or a strong fundamental bearish view. They are the dominant force pushing the Euro down.
Asset Managers / Institutional (Pension Funds, Insurance Companies)
Position: Very Net Long
Long: 506,920 (57.7%)
Short: 123,669 (14.1%)
Net Position: +383,251 contracts
This group holds the opposing, massive bullish bet. Their net long position is the dominant force supporting the Euro. This typically reflects a long-term investment view that the Euro is undervalued or will appreciate against the USD.
Leveraged Funds (Hedge Funds, CTAs)
Position: Slightly Net Long
Long: 103,962 (11.8%)
Short: 71,350 (8.1%)
Net Position: +32,612 contracts
This group is modestly net long. More importantly, look at the changes (in brackets): they reduced both their long and short positions this period (-3,849 and -5,988
respectively). This suggests a reduction in overall exposure or
profit-taking, rather than a strong directional bet. Their large spread
position indicates many are running relative value or pairs trades.
Other Reportables & Nonreportable Positions (Smaller Traders, Retail)
Other Reportables: Essentially neutral with a very small net short position (-3,394 contracts).
Nonreportable Positions (Often considered "Smart Money" or retail): are net long by +53,970 contracts. This group is often on the wrong side of major moves, so their net long position could be a contrarian bearish signal for the Euro.
3. The "Battle of the Titans"
The market structure is defined by the clash between two giants:
The Bears (Dealers): Net Short -466,439 contracts
The Bulls (Asset Managers): Net Long +383,251 contracts
This creates a precarious equilibrium. The market's direction will likely be determined by which of these groups is forced to unwind their positions. If Asset Managers start selling, the Euro could fall sharply. If Dealers are forced to cover their massive shorts, it could trigger a significant short-covering rally in the Euro.
4. Market Sentiment & Implications
Bearish Bias from Concentration: The sheer size of the Dealer short position gives a strong bearish tilt to the overall market structure.
High Potential for Volatility: The enormous open interest and the diametrically opposed positions of the two largest player groups mean that any fundamental catalyst (e.g., a major ECB or Fed policy shift, unexpected economic data) could force one side to capitulate, leading to a large and rapid price move.
Contrarian Warning Sign? The extreme nature of the Dealer short position can sometimes be a contrarian indicator. When everyone is already positioned for a move in one direction, there are fewer sellers left, and a catalyst can cause a violent reversal (a "short squeeze").
Conclusion
The Euro FX futures market as of September 9th, 2025, is a battleground between deeply bearish Dealers and overwhelmingly bullish Asset Managers. While the massive Dealer short position casts a bearish shadow over the market, the equally large Asset Manager long position provides solid underlying support.
Trading Outlook: The market is primed for high volatility. In the near term, the balance of power slightly favors the bears due to the concentration of short positions. However, the risk of a sharp upward move (a short squeeze) is significantly elevated if any positive Eurozone news emerges. A break below key support levels could see the Asset Manager longs begin to exit, accelerating a downward move. Conversely, a break above resistance could force Dealers to cover, fueling a powerful rally.
Disclaimer: This analysis is for informational purposes only and should not be considered investment advice. The COT report is a lagging indicator, reflecting positions from the previous Tuesday.
US Dollar Index COT Report As Of 9th Sept 2025
Overall Summary
The COT report reveals a market that is overwhelmingly net long the US Dollar, driven primarily by a massive bullish bet from Leveraged Funds. While Asset Managers hold a significant net short position, it is vastly outweighed by the net long positioning from other major groups. This suggests strong speculative momentum behind the dollar's strength, though it also introduces the risk of a sharp reversal if these positions are unwound.
Key Takeaways & Analysis
1. Dominant Bullish Sentiment from Leveraged Funds
This is the most striking feature of the report.
Positions: Leveraged Funds (e.g., hedge funds, CTAs) hold 18,991 long contracts versus 15,755 short contracts, resulting in a substantial net long position of 3,236 contracts.
Activity: Their net position increased dramatically from the previous week (+7,634 more longs and +13,641 more shorts). This indicates they were aggressively adding to both sides of their bets, but the net effect was a significant increase in their bullish stance. This group is often trend-following, and their aggressive buying is a strong signal of conviction in a rising dollar.
2. Asset Managers are Net Short
Positions: Asset Managers/Institutional investors hold a significant net short position (1,770 longs vs. 10,164 shorts = a net short of 8,394 contracts).
Interpretation: This group often takes more strategic, long-term hedged positions. Their net short position could reflect views on relative interest rates, global growth, or hedging against international asset holdings. They were actively increasing their short bets (+11,104 more shorts) while reducing longs (-1,640), showing a clear bearish shift in their stance. This creates a fundamental clash with the Leveraged Funds.
3. Dealers are Overwhelmingly Long
Positions: Dealers (large banks) hold a massive net long position (9,792 longs vs. a mere 150 shorts). This is a nearly 65:1 ratio.
Interpretation: Dealers are the counterparties to other traders. A large net long position suggests they have been selling futures to clients (who are buying) and are left holding the long side of the trade. This is a classic sign of a strong bullish market trend where client demand to buy is high. It can also be a contrarian indicator at extremes, suggesting the market might be overextended.
4. Other Reportables and Small Traders
Other Reportables: This group is net short (1,555 long vs. 4,955 short), aligning more with Asset Managers.
Nonreportable Positions (Small Speculators): This group is also net short (2,604 long vs. 3,688 short). Small speculators are often on the wrong side of major moves, so their net short position could be interpreted as a mildly bullish contrarian signal for the dollar.
Market Implications & Outlook
Bullish Pressure: The combined net long positioning from the powerful Leveraged Funds and Dealers is providing significant underlying support for the US Dollar. The momentum is clearly to the upside.
Clash of Titans: The market is divided. The momentum-driven Leveraged Funds (bullish) are facing off against the more strategic Asset Managers (bearish). The future direction will depend on which group is forced to capitulate and unwind their positions.
Risk of a Squeeze: The extreme nature of the Leveraged Funds' long position is a warning. If the dollar's rally stalls or news triggers a reversal, these funds could be forced to sell their long contracts simultaneously to exit their bets. This could lead to a sharp, accelerated move down (a "long squeeze").
Context is Key: This data is a snapshot. It must be combined with technical analysis (is the DXY at a key resistance level?) and fundamental drivers (Fed policy, economic data, global risk sentiment) for a complete picture. A hawkish Fed would likely fuel further gains, while a risk-off environment could see the long positions unwound quickly.
Conclusion
The COT report for September 9, 2025, paints a picture of a bullish but potentially overextended US Dollar. The market is being driven higher by aggressive speculative buying from Leveraged Funds, with Dealers facilitating this move. However, the large net long position held by speculators creates vulnerability to a sudden reversal, especially if the fundamental outlook shifts. The substantial net short position from Asset Managers provides a ceiling for the rally, setting the stage for a significant battle between these two groups.
In short: The momentum is powerfully bullish, but the market is crowded and ripe for a correction if the bullish narrative changes.
Disclaimer: This analysis is for informational purposes only and should not be considered investment advice. The COT report is a lagging indicator, reflecting positions from the previous Tuesday.
Thursday, September 11, 2025
EURUSD, GBPUSD and USDJPY rates reaction after U.S CPI and Unemployment claims news
11 Sept 2025, U.S CPI and unemployment claims news released.
EURUSD 15min chart.
GBPUSD 15min chart
Wednesday, September 3, 2025
EURUSD, GBPUSD and USDJPY moves of the day 2nd Sept 2025
The unusual trend move by these 3 major currency pairs. Move more than 150% daily average range before U.S open.
Monday, August 25, 2025
How US Non-Farm Employment Affects Currency Trading: A Comprehensive Guide
Introduction
The US Non-Farm Employment (NFP) report is one of the most influential economic indicators in forex trading. Released monthly by the Bureau of Labor Statistics (BLS), it provides critical insights into the health of the US labor market, influencing the US dollar (USD) and global currency markets.
In this article, we’ll explore:
✅ What is the Non-Farm Payroll report?
✅ Why is NFP important for forex traders?
✅ How does NFP impact currency pairs?
✅ Trading strategies around NFP releases
✅ Common pitfalls to avoid
By the end, you’ll understand how to leverage NFP data for smarter forex trading decisions.
What is the Non-Farm Payroll (NFP) Report?
The NFP report measures the number of new jobs added in the US (excluding farm workers, government employees, and non-profit organizations). Key components include:
Total employment change (month-over-month)
Unemployment rate
Average hourly earnings (wage growth)
Labor force participation rate
The report is released on the first Friday of every month at 8:30 AM EST and often triggers high volatility in forex markets.
Why is NFP Important for Forex Traders?
The US dollar (USD) is the world’s primary reserve currency, and the NFP report directly impacts:
1. Federal Reserve (Fed) Monetary Policy
Strong NFP numbers (higher job growth + rising wages) → Higher inflation expectations → Fed may raise interest rates → USD strengthens.
Weak NFP numbers (lower job growth + stagnant wages) → Economic slowdown fears → Fed may cut rates → USD weakens.
2. Market Sentiment & Risk Appetite
A strong US labor market boosts investor confidence, supporting USD, stocks, and risk assets.
Weak data may lead to safe-haven flows into currencies like JPY, CHF, or gold.
3. Currency Pair Reactions
EUR/USD, GBP/USD, USD/JPY are highly sensitive to NFP surprises.
A better-than-expected NFP typically strengthens USD, causing EUR/USD to fall.
A worse-than-expected NFP weakens USD, leading to USD/JPY declines.
How to Trade NFP News in Forex
1. Pre-NFP Preparation
Check forecasts (Bloomberg, Reuters, ForexFactory).
Monitor ADP Employment Report (released two days before NFP) as a leading indicator.
Be aware of previous revisions (past NFP numbers often get adjusted).
2. Trading Strategies
A) Breakout Strategy
Place buy-stop and sell-stop orders above/before key support/resistance levels.
NFP often causes sharp spikes, allowing traders to catch momentum.
B) Fade the Initial Move
If the market overreacts, wait for a pullback before entering.
Example: If USD surges post-NFP but lacks follow-through, a reversal may occur.
C) Straddle Strategy (Options Trading)
Use forex options to profit from volatility without predicting direction.
3. Post-NFP Analysis
Watch Fed statements and bond yields (10-year Treasury).
Sometimes, wage growth matters more than job numbers for long-term trends.
Common Mistakes to Avoid When Trading NFP
❌ Trading Without a Plan – NFP volatility can lead to emotional decisions.
❌ Ignoring Revisions – Previous months’ adjustments can change market reactions.
❌ Overleveraging – High volatility increases risk; use proper stop-loss orders.
❌ Focusing Only on Headline Number – Wage growth and unemployment rate also matter.
Conclusion
The US Non-Farm Payroll report is a game-changer for forex traders, driving USD volatility and creating trading opportunities. By understanding how NFP impacts currency markets, preparing with the right strategies, and avoiding common mistakes, traders can capitalize on this high-impact event.
Pro Tip: Always use economic calendars (like ForexFactory) to stay updated and practice risk management when trading NFP.
FAQ
Q: When is the next NFP release date?
A: The NFP is released on the first Friday of each month (check ForexFactory for exact dates).
Q: Which currency pairs are most affected by NFP?
A: EUR/USD, GBP/USD, USD/JPY, and USD/CAD are highly reactive.
Q: Should I trade before or after NFP?
A: Trading after the release reduces slippage risk, but pre-positioning can work with tight risk controls.
By mastering NFP trading, you can enhance your forex strategy and take advantage of one of the market’s most powerful catalysts. 🚀
Sunday, August 24, 2025
Euro FX COT Report Analysis Overview as Of 19 Aug 2025
Here is a detailed analysis of the Euro FX Commitment of Traders (COT) report for the week ending August 19, 2025.
Executive Summary
The COT report reveals a market that is structurally and heavily net short the Euro, a position primarily driven by Dealer institutions. However, the weekly changes show a subtle but notable shift: Asset Managers (the primary bulls) added to their long positions, while Leveraged Funds (the primary speculative shorts) also increased their bearish bets. This suggests a tightening battle between major players, with the overall net short position remaining extreme.
1. Key Overall Metrics
Open Interest (OI): 825,219 contracts (an increase of +247). The near-flat OI indicates that while positions were adjusted, very few new contracts were opened. Money is repositioning, not flooding in or out.
Total Traders: 307. This provides context for the concentration of positions discussed below.
2. Analysis by Participant Group
Dealers (Typically Banks & Dealers)
Position: Extremely Net Short. This is the most significant takeaway from the report.
Short Positions: 501,044 contracts (60.7% of OI)
Long Positions: 51,466 contracts (6.2% of OI)
Net Position: Net Short -449,578 contracts
Interpretation: Dealers are the counterparties to the market. Their massive net short position means they are effectively warehousing the risk from other participants who are net long. This is a strong, structural bearish signal for the Euro from the most sophisticated and risk-averse group.
Asset Managers / Institutional (e.g., Pension Funds, Insurance Companies)
Position: Extremely Net Long. They are the natural counterpart to the Dealers.
Long Positions: 501,183 contracts (60.7% of OI)
Short Positions: 129,953 contracts (15.7% of OI)
Net Position: Net Long +371,230 contracts
Weekly Change: They increased their net long position (+2,802 longs vs. -1,780 shorts). This shows continued, confident buying pressure from long-term institutional investors, likely viewing the Euro as undervalued or for strategic hedging purposes.
Leveraged Funds (e.g., Hedge Funds, CTAs)
Position: Net Short, but less so than Dealers.
Long Positions: 104,037 contracts (12.6% of OI)
Short Positions: 70,811 contracts (8.6% of OI)
Net Position: Net Long +33,226 contracts
Wait, that's net long? A common point of confusion. In this specific report, Leveraged Funds are actually net long. However, it's crucial to look at the weekly change:
Weekly Change: They increased their net short exposure significantly. They added +4,888 short contracts while only adding +3,178 long contracts. This is a clear bearish bet from the speculative community.
Other Reportables & Nonreportable Positions (Smaller Traders)
These groups are generally net short and made smaller adjustments, but their impact on the overall market is less significant than the three main groups above.
3. Market Sentiment & Implications
The "Battle of the Titans": The market is defined by a colossal standoff between Dealers (massive net short) and Asset Managers (massive net long). This creates a fragile equilibrium.
Speculative Sentiment: The actions of Leveraged Funds are key. Their move to increase net short bets this week aligns them more closely with the Dealers' bearish outlook. This suggests speculative money is betting on Euro weakness in the near term.
Price Outlook:
Bearish Case: The enormous net short position from Dealers is a powerful underlying bearish force. If Leveraged Funds continue to build shorts and Asset Manager buying wanes, significant downward pressure on the Euro could occur.
Bullish Case (Squeeze Potential): The market is overwhelmingly positioned for Euro weakness. If a positive catalyst emerges (e.g., a shift in ECB policy, weak US data), these massive short positions would need to be covered (i.e., buy back Euros). This could trigger a very sharp, rapid rally—a classic short squeeze.
Conclusion
The Euro FX futures market as of August 19, 2025, is poised for potential volatility. The market structure is heavily net short, dominated by Dealers, while the fundamental long-term buying from Asset Managers continues. The key development this week is that speculative Leveraged Funds have joined the bearish side.
Traders should watch for any catalyst that could force one of these major groups to unwind their positions. A break lower would validate the speculative shorts, while an unexpected rally could force them to cover, accelerating the move upward.
Disclaimer: This analysis is for informational purposes only and should not be considered investment advice. The COT report is a lagging indicator, reflecting positions from the previous Tuesday.
British Pound COT report Analysis as of 19 Aug 2025
Here is a detailed analysis of the Commitments of Traders (COT) report for British Pound Futures as of August 19, 2025.
Executive Summary
The report reveals a market that is overwhelmingly net short the British Pound, driven primarily by a massive bearish position from Asset Managers. This selling pressure is being absorbed by Leveraged Funds and Dealer Intermediaries, who hold significant net long positions. The market structure suggests a strong bearish sentiment among institutional investors, with speculative players betting against it.
1. Key Market Overview
Open Interest: 219,831 contracts (a decrease of 13,749 from the previous week). This decline in open interest, alongside a falling price, often suggests long positions are being liquidated or closed out, reinforcing the bearish trend.
Total Traders: 184
2. Analysis by Trader Group
Dealer/Intermediary
Position: Net Long (+40,425 contracts)
Long: 60,669
Short: 20,244
Interpretation: Dealers are typically the "smart money" that takes the other side of client trades. Their significant net long position means they are effectively buying the Pound from others who are selling (primarily Asset Managers). This is a classic risk-off flow where institutions hedge their FX exposure by selling to dealers.
Asset Manager/Institutional
Position: Extremely Net Short (-67,141 contracts)
Long: 45,610
Short: 112,751
Interpretation: This is the most significant finding in the report. Institutional investors hold a massive net short position, representing the core bearish sentiment in the market. This group includes pension funds, insurance companies, and other entities that are likely hedging their UK asset exposure or making a outright bearish bet on the GBP.
Leveraged Funds (e.g., Hedge Funds, CTAs)
Position: Net Long (+22,454 contracts)
Long: 64,243
Short: 41,789
Interpretation: Leveraged funds are speculative "fast money." Their net long position indicates they are betting against the prevailing bearish trend set by Asset Managers. They might be anticipating a short-term bounce or a reversal. However, the large increase in their short positions (+15,954) shows that a portion of this group is also joining the sell-side, creating a mixed picture.
Other Reportables & Nonreportable Positions (Smaller Traders)
Position: Slightly Net Short for Other Reportables; Net Long for Nonreportables.
Interpretation: These groups (smaller speculators and retail traders) have a minimal aggregate impact on the market direction compared to the large players.
3. Net Position Summary & Market Sentiment
| Trader Group | Net Position | Sentiment | Role |
|---|---|---|---|
| Dealer/Intermediary | +40,425 | Bullish | Smart Money, absorbing sells |
| Asset Manager/Institutional | -67,141 | Extremely Bearish | Driving the market trend |
| Leveraged Funds | +22,454 | Bullish | Speculating against the trend |
| Other/Nonreportable | ~+4,300 | Slightly Bullish | Minor influence |
Overall Market Sentiment: BEARISH. The sheer size of the net short position from Asset Managers dominates the market's posture.
4. Changes from the Previous Week (The "Change" Row)
The numbers below the positions show the weekly change. This is crucial for understanding momentum.
Asset Managers: Increased their net short position dramatically.
They added +11,020 new long contracts but added a staggering +31,050 new short contracts. This is a clear and aggressive move to the bearish side.
Leveraged Funds: Their activity was mixed but leaned bearish.
They added +11,030 longs but also added a massive +15,954 shorts. This shows they were actively selling into the market decline, even while maintaining a net long book.
Dealers: Increased their net long position.
They added more longs (+1,474) than shorts (+1,225), confirming they were consistent buyers.
Nonreportable (Small Specs): They were forced out of long positions, closing -2,381 contracts, and were heavily shorted against, adding +41,564 new short contracts. This is a classic sign of capitulation from the retail/small speculator crowd, often a contrarian signal that a move may be nearing exhaustion.
5. Trading Implications & Conclusion
Bearish Dominance: The market structure is fundamentally bearish due to institutional hedging/selling.
Contrarian Signals: The fact that "smart money" Dealers are net long and that small speculators (Nonreportables) were net sellers and massively increased their short exposure can be seen as a contrarian bullish signal. Historically, when the crowd is extremely positioned one way, a reversal becomes more likely.
Key Levels to Watch: The market is poised for a significant move.
If the bearish fundamental story (e.g., weak UK economic data) continues, the Asset Managers could push prices even lower. Their positioning is not yet at an extreme that suggests a reversal is imminent.
However, the buildup of long positions from Leveraged Funds and Dealers, combined with the capitulation of small specs, means any positive trigger for the GBP could lead to a sharp short-covering rally as these massive short positions are bought back.
In summary, the COT report paints a picture of a deeply bearish market driven by institutional flows, but one that is also showing early classic signs of being over-extended to the downside, setting the stage for a potential powerful reversal when sentiment shifts.
Disclaimer: This analysis is for informational purposes only and should not be considered investment advice. The COT report is a lagging indicator and should be used in conjunction with other technical and fundamental analysis.
Dollar Index Future COT report Analysis as of 19 Aug 2025
Let's break down this Commitment of Traders (COT) report for the Dollar Index Futures (ICE U.S.) as of the week ending August 19, 2025.
Executive Summary
The market is dominated by Leveraged Funds, who hold a significant net short position. This is counterbalanced by Asset Managers/Institutions, who are the primary net long group. Dealer Intermediaries are also strongly net long, which is a typical hedging activity. Overall, the positioning suggests a market where speculative players (Leveraged Funds) are betting against the dollar index, while institutional and dealer players are taking the other side of that trade.
Detailed Analysis by Trader Group
Here’s a breakdown of what each group is doing and what it typically signifies:
1. Dealer Intermediaries
Position: Net Long.
Long Positions: 9,625 (33.3% of Open Interest)
Short Positions: 177 (0.6% of Open Interest)
Analysis: This group is overwhelmingly net long. Dealers are often market makers and hedgers. Their massive long position suggests they are providing liquidity to the market by taking the other side of trades from players who want to be short (like Leveraged Funds). This is a common and expected pattern.
2. Asset Manager / Institutional
Position: Net Short.
Long Positions: 2,075 (7.2% of OI)
Short Positions: 7,722 (26.7% of OI)
Analysis: This group holds a substantial net short position. Institutional investors often use the Dollar Index for macro hedging or directional bets. Their significant net short position indicates a broad institutional expectation that the U.S. Dollar will weaken against the basket of currencies in the index.
3. Leveraged Funds (e.g., Hedge Funds, CTAs)
Position: Net Short.
Long Positions: 8,676 (30.0% of OI)
Short Positions: 12,483 (43.2% of OI)
Analysis: This is the most important group for gauging speculative sentiment. They hold the largest gross short position of any group and are decisively net short. This shows that the speculative community is heavily betting on a decline in the Dollar Index. The change in their positions (the number below, e.g., +1,881 for their short positions) suggests they increased their net short exposure during the reporting week.
4. Other Reportables
Position: Net Short.
Long Positions: 1,757 (6.1% of OI)
Short Positions: 2,679 (9.3% of OI)
Analysis: This mixed group of large traders who don't fit the other categories is also net short, aligning with the overall bearish speculative sentiment.
5. Nonreportable Positions (Small Speculators)
Position: Net Long.
Long Positions: 4,046 (14.0% of OI)
Short Positions: 3,118 (10.8% of OI)
Analysis: Small retail traders are net long. Often considered a contrarian indicator, this net long positioning from the "crowd" against the net short positioning of large speculators (Leveraged Funds) can sometimes signal that the prevailing trend (down) might have further to go.
Key Takeaways and Market Implications
Clear Divergence: There is a clear battle between two major forces:
The Speculators (Net Short): Leveraged Funds are aggressively short.
The Institutions & Dealers (Net Long): Asset Managers and, especially, Dealers are providing the long-side liquidity.
Bearish Speculative Bias: The overwhelming net short position from Leveraged Funds is a strong bearish signal for the Dollar Index in the short term. This group tends to be trend-following, so this suggests the recent price trend has been down, and they are betting on its continuation.
Contrarian Warning Sign? Extremely one-sided positions can sometimes be a contrarian indicator at major turning points. If the market stops falling and begins to rise, these large short speculators could be forced to buy back contracts to cover their losses (a "short squeeze"), which would fuel a sharp rally. For now, the pressure is to the downside.
Strength of the Move: The large number of traders in the Leveraged Funds category (25 traders short vs. 23 long) indicates the bearish view is broad-based, not just concentrated in a few large funds. This can give the downtrend more sustainability.
In summary, this COT report paints a picture of a market with heavy speculative short interest betting against the U.S. Dollar Index, with institutional and dealer players on the other side. The dominant force for the immediate future is the bearish sentiment from Leveraged Funds.
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