Forex - Flows: DXY - spec most short dollar since Jan 13

 20:11 (GMT) 11 Aug

  [Forex Flows]

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Flows: DXY - spec most short dollar since Jan 13 (0100-RPDQ-C01)

Despite today's dollar decline after the CPI data, it's worth taking note of the latest IMM data. Overall, the market is most dollar short since Jan 13. The DXY was at the range lows of the last 5 years at the time, and on the shorter horizon the dollar low that month gave way to a almost 6 figure rally over the next 5 months. You don't have to be a fan of the dollar to consider that the market has gone from medium-term stretched dollar bullish to potentially short/medium-term stretched dollar bearish. Meanwhile, net euro longs are at their highest since May 11. The euro trade weighed saw a 1 year peak that month and gave way to 17% decline over the next approx. year. That was during a long-term bear market so will have seen a more powerful downleg, but it still suggests we are due a corrective phase. The EUR TWI has been strongly outrunning its supporting annual uptrend and a correction would take the euro back around 5%.

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