Positions of large speculators according to the COT report as at 29/3/2022

Total net speculator positions in the USD index rose by 1,306 contracts last week. This change is the result of an increase in long positions by 1,409 contracts and an increase in short positions by 103 contracts.
Growth in total net positions occurred last week in the euro, the Australian dollar and the Canadian dollar. There were declines in the total net positions of large speculators in the British pound, the New Zealand dollar, the Japanese yen and the Swiss franc.
In the Japanese yen, in particular, the decline in total net positions of large speculators has been very strong. Over the past five weeks, total net positions have decreased by 38 944 contracts. The total net positions of large speculators are the most bearish for the yen in the last 20 weeks. This may be due to the Bank of Japan's continuing dovish monetary policy to support Japanese economic growth.

The positions of speculators in individual currencies

The total net positions of large speculators are shown in Table 1: If the value is positive then the large speculators are net long. If the value is negative, the large speculators are net short.
 

Note: The explanation of COT methodolody is at the the end of the report.
 

Notes:

• Large speculators are traders who trade large volumes of futures contracts, which, if the set limits are met, must be reported to the Commodity Futures Trading Commission. Typically, this includes traders such as funds or large banks. These traders mostly focus on trading long-term trends and their goal is to make money on speculation with the instrument.
• ​The total net positions of large speculators are the difference between the number of long contracts and the number of short contracts of large speculators. Positive value shows that large speculators are net long. Negative value shows that large speculators are net short. The data is published every Friday and is delayed because it shows the status on Tuesday of the week.
• The total net positions of large speculators show the sentiment this group has in the market. A positive value of the total net positions of speculators indicates bullish sentiment, a negative value of total net positions indicates bearish sentiment.
• When interpreting charts and values, it is important to follow the overall trend of total net positions. The turning points are also very important, i.e. the moments when the total net positions go from a positive value to a negative one and vice versa. Important are also extreme values ​​of total net positions as they often serve as signals of a trend reversal.
• Sentiment according to the reported positions of large players in futures markets is not immediately reflected in the movement of currency pairs. Therefore, information on sentiment is more likely to be used by traders who take longer trades and are willing to hold their positions for several weeks or even months.

Detailed analysis of selected currencies

Explanations:
 

• Purple line and histogram: this is information on the total net position of large speculators. This information shows the strength and sentiment of an ongoing trend. It is the indicator r_COT Large Speculators (by Kramsken) in www.tradingview.com.
• Information on the positions of so-called hedgers is not shown in the chart, due to the fact that their main goal is not speculation, but hedging. Therefore, this group usually takes the opposite positions than the large speculators. For this reason, the positions of hedgers are inversely correlated with the movement of the price of the underlying asset. However, this inverse correlation shows the ongoing trend less clearly than the position of large speculators.​
• We show moving average SMA 100 (blue line) and EMA 50 (orange line) on daily charts.

​Charts are made with the use of www.tradingview.com. The source of numerical data is www.myfxbook.com

The Euro

Figure 1: The euro and COT positions of large speculators on a weekly chart and the EURUSD on D1
 

The total net positions of speculators reached 21,374 contracts last week, down by 2,469 contracts compared to the previous week. This change is due to a decrease in long positions by 7,008 contracts and a decrease in short positions by 4,539 contracts. This data indicates weak bullish sentiment for the euro.
Open interest has risen by 3 598 contracts in the last week. This shows that the upward movement that occurred in the euro last week was supported by a volume and is therefore strong price action.
The euro continues to move in a downtrend. Last week it returned to the resistance level from which it bounced downwards.
Long-term resistance: 1.1160 – 1.1180
Support: 1.0950-1.0980 and the next support is at 1.080-1.0850.

The British pound

Figure 2: The GBP and COT positions of large speculators on a weekly chart and the GBPUSD on D1

The total net positions of speculators last week reached - 37,244 contracts, down by 8,183 contracts compared to the previous week. This change is due to the growth of long positions by 311 contracts and the growth of short positions by 8,494 contracts. This suggests bearish sentiment as the total net positions of large speculators are negative while there has been a further decline.
Open interest rose by 7,389 contracts last week. This means that the modest rise in the pound that occurred last week was supported by the volume and is therefore strong.
However, the pound's growth was not significant. In addition, a pin bar formed on the weekly chart which would suggest more of a further weakening in line with sentiment.
Long-term resistance: 1.3270 – 1.3300.
Support is near 1.3000.  

The Australian dollar

Figure 3: The AUD and COT positions of large speculators on a weekly chart and the AUDUSD on D1

The total net positions of speculators reached 49,606 contracts last week, having grown by 1,583 contracts compared to the previous week. This change is due to the growth of long positions by 10,213 contracts and the growth of short positions by 8,630 contracts. This data suggests weak bearish sentiment for the Australian dollar as the total net positions of large speculators are negative, but they increased last week.
There was an increase in open interest of 15,240 contracts last week. This means that the sideways movement that occurred last week was supported by the volume and was therefore strong as new money flowed into the market.
The Australian dollar moved near a strong resistance level last week. If it is validly broken then a further bullish movement may be seen. 
Long-term resistance: 0.7510-0.7560                                                                                                             
Long-term support: 0.7370-0.7440.  A next support is near 0.7160 – 0.7180.

The New Zealand dollar

Figure 4: The NZD and the position of large speculators on a weekly chart and the NZDUSD on D1

The total net positions of speculators last week amounted to - 867 contracts, having fallen by 3,387 contracts compared to the previous week. This change is due to a decrease in long positions by 1,652 contracts and an increase in short positions by 1,735 contracts. This data suggests that there was a bearish sentiment for the New Zealand dollar over the past week as the total net positions of large speculators got negative.
Open interest fell by 375 contracts last week.  Therefore, the sideways move in the NZDUSD that occurred last week was not supported by a volume and therefore the move was weak.
The NZDUSD strengthened strongly last week and got to the resistance level.
Long-term resistance: 0.6980 – 0.7000
Long-term support: 0.6860-0.6880 and the next support is at 0.6730 – 0.6740.

Explanation to the COT report

• The COT report shows the positions of major participants in the futures markets. Futures contracts are derivatives and are essentially agreements between two parties to exchange an underlying asset for a predetermined price on a predetermined date. They are standardised, specifying the quality and quantity of the underlying asset. They are traded on an exchange so that the total volume of these contracts traded is known.

• Open interest: open interest is the sum of all open futures contracts (i.e. the sum of short and long contracts) that exist on a given asset. OI increases when a new futures contract is created by pairing a buyer with a seller. The OI decreases when an existing futures contract expires at a given expiry time or by settlement.
• Low or no open interest means that there is no interest in the market. High open interest indicates high activity and traders pay attention to this market. A rising open interest indicates that there is demand for the currency. That is, a rising OI indicates a strong current trend. Conversely, a weakening open interest indicates that the current trend is not strong.

• Large speculators are traders who trade large volumes of futures contracts, which, if the set limits are met, must be reported to the Commodity Futures Trading Commission. Typically, this includes traders such as funds or large banks. These traders mostly focus on trading long-term trends and their goal is to make money on speculation with the instrument. Traders should try to trade in the direction of these large speculators.
• The total net positions of large speculators are the difference between the number of long contracts and the number of short contracts of large speculators. Positive value shows that large speculators are net long. Negative value shows that large speculators are net short. The data is published every Friday and is delayed because it shows the status on Tuesday of the week.
• The total net positions of large speculators show the sentiment this group has in the market. A positive value of the total net positions of speculators indicates bullish sentiment, a negative value of total net positions indicates bearish sentiment.
• When interpreting charts and values, it is important to follow the overall trend of total net positions. The turning points are also very important, i.e. the moments when the total net positions go from a positive value to a negative one and vice versa. Important are also extreme values ​​of total net positions as they often serve as signals of a trend reversal.
• The COT data are usually reported every Friday and they show the status on Tuesday of the week.
• Sentiment according to the reported positions of large players in futures markets is not immediately reflected in the movement of currency pairs. Therefore, information on sentiment is more likely to be used by traders who take longer trades and are willing to hold their positions for several weeks or even months.