2 Extremely Crowded Currency Trades

Posted by Movement Capital via Seeking Alpha

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Bonds: Traders are betting on a steeper Treasury yield curve. They’re short the 30-year bond and long the 5-year.

Commodities: Hedgers are extremely long cocoa and short feeder cattle. Speculators have ramped up their long exposure to gold since March. They’re also extremely short soybeans.

Currencies: Traders are betting on a stronger AUD/USD and MXN/USD. We saw some fairly aggressive short covering in GBP/USD last week.

Stocks: Money managers are still less bullish on the Nasdaq vs. the Dow. Traders covered a few VIX shorts last week.

Note: My approach for analyzing CoT data to reveal how different types of traders are positioned in the futures markets is outlined here. If you missed it, give the article a read to see the method behind my analysis. All data and images in this article come from my website.

This article outlines how traders are positioned and how that positioning has recently changed. I break down the updates by asset class, so let’s get started.


Traders covered shorts in 30-year bond (NYSEARCA:TLT) futures last week. Overall though, they still have a significant short bias.

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