A reversal in USD position has seen positions shift away from a net short of 40,795 on Sept.6 to a net long position of 9,573 on Sept.13. The move back into the dollar was accompanied with the dollar index (DXY) also breaking its 200-day moving average, reaching 77 mark.
While the data up until Sept.13 does not capture the bulk of the rally that materialized at the end of last week, the swift reversal of USD short positions in the last two weeks represents a significant pick up in risk and disappointment in G7 efforts to stem the crisis, according to strategists at Royal Bank of Canada.
The latest data also shows eurozone periphery strains continued to weigh on sentiment with EUR net shorts rising from 36,443 on Sept.6 to 54,459 on Sept.13. AUD long positions were also trimmed down to 36,934 from 48,041 the previous week and GBP net shorts rose from 13,220 to 26,193, the highest net short GBP position in 9 weeks.
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| Source: RBC |