Financials –
A friend brought to my attention the spec (non-commercial) positioning in the Euro yesterday, and I’ve attached a 10-year history below. It is catching some attention because as you can see the net long position in the Euro is near the highest it has been in the past 10 years and whenever anything reaches a historical extreme it is worth noting. That said, if you look at the scale, the net position really isn’t that big. It is big relative to its history but depending on your fundamental bias it certainly would have room to move larger if specs were to get as bullish as they have been bearish in the past. That being said, as noted yesterday ECB President Draghi was pretty dovish over the weekend and if he continues to take a very dovish tone going forward it might shake a few of the late-to-the-party longs out for a bit here. Looking at the chart, the 1.14-1.15 level looks like it might be the next major technical resistance hurdle.
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