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Francesco Pesole, FX Strategist at ING, points out that in the week 13-19 November, the CFTC Commitments of Traders figures showed that the dynamics probably reflect some skepticism around the advancement in Sino-American trade negotiations, that contributed to keep appetite for the USD supported whilst also ending the slump in JPY net positioning.

Key Quotes

“EUR/USD net positioning only moved marginally lower and remains around-11% of open interest, in line with its 5-year average. The gauge (similarly to the pair itself) seems stuck in a very narrow range, with speculative investors likely waiting on more signs of a rebound in the battered Eurozone economic outlook to consider adding longs in the pair.”

“The data does not cover the eurozone PMI released last Friday, which showed a tentative recovery in manufacturing (although services dropped). It will be interesting to monitor next week’s CFTC report to spot any change in sentiment on the EUR, given that in the spot market the common currency remained capped.”