USD net shorts dropped sharply in the week ended Sept. 6, falling from 112,095 to 40,975 after market risk rose. That was also reflected in the DXY dollar index, traded on the ICE exchange, which rose last week and broke the significant barrier, its 200 daily moving average (DMA).
| USD net positions vs Dollar index |
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| Source: Royal Bank of Canada |
According to Royal Bank of Canada, market sentiment to buy dollars was driven by a “steady drip of rather daunting news out of the EU, with uncertainty over officials’ ability to get ahead of the crisis.” The open questioning of the solvency of Europe’s periphery has encouraged a significant move to short euro positions, and is expected to have increased in the week ended Sept. 9, RBC says. Euro positioning moved from an almost neutral position to -36,443.