The Report on positions under currency futures on 2007/05/07
The report on positions under currency futures on 2007/05/07
The main center of trade in currency futures is the Chicago Commodity exchange (Chicago Mercantile Exchange (CME). Among professional traders the future currency market is even more widespread, than market FOREX on conditions spot on which we it is traded. Therefore, having the information on what positions, short or long, at present prevail in the market of currency futures, we can spend more reliably trading operations in the market spot.
The given report is based on the report under transactions of traders (Commitment of Traders Report (СОТ) the American federal commission on trade in commodity futures (CFTC). The report leaves weekly, as a rule, late at night on Friday or on Monday and shows the open interests for the various markets, including for the market of currency futures, for every Tuesday weeks. The open interest represents quantity of the open future positions on purchase and on sale. In the report of traders divide on two groups: commercial traders-hedgers and noncommercial traders – speculators.
Commercial traders use the future market for hedging risks in the commercial activity. Their overall objective - to not earn money in the currency market, and insurance from undesirable fluctuations of rates of exchange. Therefore at calculation of long and short positions under currency futures we shall not consider them. Noncommercial traders are usual participants of the market who try to earn on movements of rates of exchange, spending operations under the purchase and sale of currency future contracts.a In it they practically do not differ from traders in market FOREX on conditions spot. The quantity of the open future positions, especially if it is maximal or minimal for the certain period of time can be a signal of a turn of the tendency.
Pure Long Positions. Pure Long Positions show excess of long future positions above short. For example, we shall admit, that long positions on pound sterling was 25,3 thousand, and short 17,4 thousand then make 25,3–17,4=7,9 one thousand Or long positions was 18,7 thousand, and short 24,6 thousand then make 18,7-24,6 =-5,9 thousand, that is short positions dominate.
If on any currency it is more than long positions than short, that is it is more 0 and in dynamics by the previous periods tends to growth the given currency will grow. If the price of currency grows, and falls or remains constant the tendency, most likely will not exist long, there is a probability of a turn of the tendency. Similar on a principle divergence on volume. Pure Long Positions in the future market carry out a role of volumes of the tenders on FOREX-spot, but they more informative because are expressed in quantity of contracts (real volume of the tenders), instead of in quantity of transactions, in the second it is the open positions of all participants of the currency future market in the world, and not just clients and dealing companies.
It is similarly possible to consider a situation when negative, that is short positions exceed long. When on any currency negative, also tends in dynamics, in relation to the previous periods the currency will decrease to fall. If the price of currency falls, and grows or remains constant the tendency, most likely will not exist long, there is a probability of a turn of the tendency.
There is still a situation when long and short positions are approximately equal, or a difference between them insignificant, these are the moments of indecision of the market when it was not defined what to do further. It can be both the beginning of a turn of the tendency, and a time respite before renewal of a trend.
Some currency pairs in the report the nonclassical appearance, for example currency pair have Franc is classically written in such kind - USD/CHF,in the report this currency pair is written CHF/USD. It is connected with a format of an output of the report. In it on the first place currencies on which Pure Long Positions are considered always cost. As it has been mentioned above, the report leaves, as a rule, either on Friday, or on Monday, but data in it are reflected as of Tuesday of accounting week, therefore, logically to believe, that the information which you receive from the report, the latest situation in the market can mismatch some. Data of the report, as a rule, are a little bit late for acceptance on them of the trading decision. Therefore, first, pure long positions under currency futures should be considered in dynamics, secondly for fuller picture it is necessary to combine the analysis data of the information with the analysis of the report on options to levels which has no such delay. These two reviews cover all market of derivative currency tools which is not less widespread than market FOREX on conditions spot. Also it is not necessary to forget, that on pure long positions, also as well as on indicators, periodically there are periods bull or bear divergence when future pure long positions start to miss dynamics of an exchange rate, these moments are the important trading signals.
The main center of trade in currency futures is the Chicago Commodity exchange (Chicago Mercantile Exchange (CME). Among professional traders the future currency market is even more widespread, than market FOREX on conditions spot on which we it is traded. Therefore, having the information on what positions, short or long, at present prevail in the market of currency futures, we can spend more reliably trading operations in the market spot.
The given report is based on the report under transactions of traders (Commitment of Traders Report (СОТ) the American federal commission on trade in commodity futures (CFTC). The report leaves weekly, as a rule, late at night on Friday or on Monday and shows the open interests for the various markets, including for the market of currency futures, for every Tuesday weeks. The open interest represents quantity of the open future positions on purchase and on sale. In the report of traders divide on two groups: commercial traders-hedgers and noncommercial traders – speculators.
Commercial traders use the future market for hedging risks in the commercial activity. Their overall objective - to not earn money in the currency market, and insurance from undesirable fluctuations of rates of exchange. Therefore at calculation of long and short positions under currency futures we shall not consider them. Noncommercial traders are usual participants of the market who try to earn on movements of rates of exchange, spending operations under the purchase and sale of currency future contracts.a In it they practically do not differ from traders in market FOREX on conditions spot. The quantity of the open future positions, especially if it is maximal or minimal for the certain period of time can be a signal of a turn of the tendency.
Pure Long Positions. Pure Long Positions show excess of long future positions above short. For example, we shall admit, that long positions on pound sterling was 25,3 thousand, and short 17,4 thousand then make 25,3–17,4=7,9 one thousand Or long positions was 18,7 thousand, and short 24,6 thousand then make 18,7-24,6 =-5,9 thousand, that is short positions dominate.
If on any currency it is more than long positions than short, that is it is more 0 and in dynamics by the previous periods tends to growth the given currency will grow. If the price of currency grows, and falls or remains constant the tendency, most likely will not exist long, there is a probability of a turn of the tendency. Similar on a principle divergence on volume. Pure Long Positions in the future market carry out a role of volumes of the tenders on FOREX-spot, but they more informative because are expressed in quantity of contracts (real volume of the tenders), instead of in quantity of transactions, in the second it is the open positions of all participants of the currency future market in the world, and not just clients and dealing companies.
It is similarly possible to consider a situation when negative, that is short positions exceed long. When on any currency negative, also tends in dynamics, in relation to the previous periods the currency will decrease to fall. If the price of currency falls, and grows or remains constant the tendency, most likely will not exist long, there is a probability of a turn of the tendency.
There is still a situation when long and short positions are approximately equal, or a difference between them insignificant, these are the moments of indecision of the market when it was not defined what to do further. It can be both the beginning of a turn of the tendency, and a time respite before renewal of a trend.
Some currency pairs in the report the nonclassical appearance, for example currency pair have Franc is classically written in such kind - USD/CHF,in the report this currency pair is written CHF/USD. It is connected with a format of an output of the report. In it on the first place currencies on which Pure Long Positions are considered always cost. As it has been mentioned above, the report leaves, as a rule, either on Friday, or on Monday, but data in it are reflected as of Tuesday of accounting week, therefore, logically to believe, that the information which you receive from the report, the latest situation in the market can mismatch some. Data of the report, as a rule, are a little bit late for acceptance on them of the trading decision. Therefore, first, pure long positions under currency futures should be considered in dynamics, secondly for fuller picture it is necessary to combine the analysis data of the information with the analysis of the report on options to levels which has no such delay. These two reviews cover all market of derivative currency tools which is not less widespread than market FOREX on conditions spot. Also it is not necessary to forget, that on pure long positions, also as well as on indicators, periodically there are periods bull or bear divergence when future pure long positions start to miss dynamics of an exchange rate, these moments are the important trading signals.
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