Forex Flash: Some Speculative selling of EUR and AUD - Nomura

FXstreet.com (Barcelona) - Nomura strategists note that there has been some notable positioning changes over the week were continued paring back of AUD longs, and adding to EUR shorts along with some JPY short covering by noncommercial investors.

They note that AUD longs decreased by $2.3bn (current level: +$3.2bn), as speculative investors cut their longs for the fourth straight week. The short covering trend in the EUR shifted somewhat, and short positions increased to -$5.6bn (from -$4.9bn). JPY shorts were pared back somewhat, but still remain fairly high (-$10.0bn) and the vol skew is still flagging bearish positioning in the options market.

Looking to JPY, they note that positioning remains net short at -80k contracts, and it appears spec investors looked to square positions ahead of the BOJ meeting later in the week. Their real-time indicator points to some addition of shorts in the week after Tuesday. Focusing on EUR, they see that positions remain net short (-34k contracts), and there was addition to the shorts, after two weeks of covering by specs. Their real time indicator points to no significant change since Tuesday. They finish by commenting that as commodity prices stabilized, some of the commodity currency moves were reversed (mainly CAD), though the AUD continued to see bearish changes in positioning though the level remains long at 31k contracts.