COT: Euro long spikes; VIX short capitulates

The below summary highlights futures positions and changes made by hedge funds across forex, bonds and stocks up until last Tuesday, March 24. A period that saw the US Federal Reserve rolled out some of its heaviest artillery to announce ‘open ended’ QE. It was a reminder of the moves they made in March 2009 which finally succeeded in stabilizing the global markets. During the reporting week stocks hit a through on March 23, the dollar continued to strengthen. 

In forex speculators, with just a couple of exceptions, continued to cut both long and short positions across all ten IMM currency futures. Despite seeing the dollar rally extend into a second week the net position turned a bit more negative at -$6.6 billion.

While the Dollar Index was bought and JPY and CAD were both sold, the net dollar position still ended more negative due to continued strong buying of the euro. Four weeks of buying has taken the euro net-long to  61,290 lots ($8.3 billion equivalent), the highest since June 2018.

Bullish wagers on the Mexican Peso declined for an 8^th week as the currency sank by more than 7% to hit a record low against the dollar. The net-long was cut by 35% to 21,979 lots.

Reductions of both long and short positions also continued in fixed income and equities. Substantial short-covering in the C’boe VIX contract reduced the net-short to just 18,708 lots, the least short in 14 months.