FX.co ★ berta.hill | EUR/USD

EURUSD. Greetings to all. The fresh COT report for euro futures for September 8 has been released, and it requires very careful analysis, because it mixes two powerful factors: the rollover of the futures contract and real changes in the positioning of major players. Let's start with open interest. It jumped by 77 052 contracts and reached 942 464. This is a colossal increase, but it must be noted immediately: most of this growth is technical, related to the rollover from the September contract to the December one. The number of traders at the same time fell to 314, which confirms the technical nature of the move. Some of the group data is clearly incomplete, and this is also a sign of a transition period. Now about the structure. Commercial participants Commercial sharply increased both long and short positions. Longs rose by 59 242 contracts, shorts by 43 785. But since the shorts were larger in absolute terms, their net position turned short again and amounted to minus 6 730 contracts. This is a bearish signal, but with the caveat of a rollover. Large speculators Non-Commercial, on the contrary, reduced both long and short positions. Longs decreased by 4 968 contracts to 198 509, shorts decreased by 12 723 contracts to 241 125. Their net short position shrank from 50 371 to 42 616 contracts. That is, speculators continue to cover their shorts but still remain net short. In the expanded report the picture is even more interesting. Dealers and intermediaries practically did not change their long and short positions, but sharply increased spreads by 32 300 contracts. Asset managers increased longs by 16 189 contracts and shorts by 28 764, while reducing spreads by 14 731. Leveraged funds reduced both long and short positions, but at the same time sharply increased spreads by 37 235 contracts. This is a classic picture of a rollover: large players roll over via spreads and arbitrage, not via pure directional bets. Now let's move on to the levels that currently determine the whole picture. The options balance is at 1.15754. The upper bound of the options range is 1.19329, the lower is 1.14476. The balance of the current futures contract is located in the zone 1.16172-1.16025. The long-term trend balance according to COT data is in the range 1.15379-1.15257. What this means in practice. The price at the moment is trading around 1.16, that is, inside the balance of the current futures contract 1.16172-1.16025. This is the key zone on which the near-term direction depends. If the bulls can hold above 1.16172, the road to the upper boundary of the options range 1.19329 will open. If the price falls below 1.16025, the first target will be the options balance 1.15754, and then the long-term COT balance 1.15379-1.15257. The lower options boundary 1.14476 remains a distant reference in case of a strong bearish move. Comparing this with the COT data, we get the following picture. Speculators are reducing their short positions, which is a bullish signal. Commercials increased short positions, which is a bearish signal. Dealers and leveraged funds are actively working through spreads, which indicates high uncertainty and preparation for a strong move. Open interest rose, but a significant part of this growth is a technical rollover. Thus, the market is at an equilibrium point where none of the groups has a clear advantage. The key battle is around the zone 1.16172-1.16025. As long as the price remains above the options balance 1.15754, the bullish scenario remains valid. If the price settles below this level, pressure on the euro will increase, and the next targets will be the levels 1.15379-1.15257. The next COT report, when the data settles after the rollover, will show who actually controls the market. For now we remain in observation mode and closely watch the price reaction at the key levels. Good luck everyone.