COT data of Feb 19th 2013 - British Pound [BP]

British Pounds - Total o/i was higher, at 187027, with spreads about unchanged, at 1353 (0.7% of the total).

Nett differences:

Commercials +46042 (from +33083).  Large Specs -23365 (from -16776).  Small Specs -22677 (from -16307). Commercials added considerably to their longs, but also added to shorts (although not in proportion to the higher total o/i). Small Specs reduced longs even further, and added to shorts.

 

Proportions:  

Commercials (56.9% of total o/i) - 69.3% of Longs, 44.5% of Shorts, balance plus 24.8 

Large Specs (28.2% of total) - 21.9% of Longs, 34.5% of Shorts, balance minus 12.6

Small Specs (14.9% of total) - 8.8% of Longs, 21.0% of Shorts, balance minus 12.2

Commercials continued to add to longs as the market continued to decline, taking their nett balance to a comparatively high level. Large Specs continued to chase the market lower, reducing their share of  longs and adding very slightly to their share of shorts (although their actual number of short contracts went from 55437 to 64033). Small Specs joined in the rout, reducing longs and adding to shorts. This is beginning to put their share of the market (both as 'nett difference' and 'nett balance') in a rather precarious state.

Prices have continued to decline from last Tuesday's close, and it may be that further pressure will be seen based on Moody's reduction of Britain's credit standing from AAA to AA1. However, the COT statistics (having moved beyond the levels seen at last June's price lows) are now comparable to those seen in early March 2012, which also marked a low point in prices. We would follow the next major bullish chart signal (although that might not be immediate). 

COT data of Feb 12th 2013 - British Pound [BP]

British Pounds - Total o/i was not much changed, at 167100, with spreads lower, at 1349 (0.8% of the total).

Nett differences:

Commercials +33083 (from +16548).  Large Specs -16776 (from +1174).  Small Specs -16307 (from -17722). Commercials added considerably to their longs, Large Specs reduced theirs while adding to shorts.

 

Proportions:  

Commercials (56.1% of total o/i) - 66.1% of Longs, 46.2% of Shorts, balance plus 19.9 

Large Specs (28.4% of total) - 23.3% of Longs, 33.4% of Shorts, balance minus 10.1

Small Specs (15.5% of total) - 10.6% of Longs, 20.4% of Shorts, balance minus 9.8

Commercials once again added considerably to longs while leaving shorts alone; Large Specs reduced longs and added to shorts, moving to nett short for the first time since mid-September. Small Specs took some profits on their shorts,, and nibbled at the long side. There was not a great deal of change in shares of the total market.

Last Tuesday's close was unchanged from the previous week, at 1.5660, although prices before and since have continued to swing rather widely. With Commercials going longer and Large Specs now going short, conditions are becoming similar to early June last year, when prices bottomed.

COT data of Feb 5th 2013 - British Pound [BP]

British Pounds - Total o/i was barely changed, at 165369, with spreads very slightly lower, at 3151 (1.9% of the total).

Nett differences:

Commercials +16548 (from +140).  Large Specs +1174 (from +10622).  Small Specs -17722 (from +10762). Commercials moved more vigorously to nett long, Small Specs went further short.

Proportions:  

Commercials (52.4% of total o/i) - 57.5% of Longs, 47.3% of Shorts, balance plus 10.2 

Large Specs (31.7% of total) - 32.0% of Longs, 31.3% of Shorts, balance plus 0.7

Small Specs (15.9% of total) - 10.5% of Longs, 21.4% of Shorts, balance minus 10.9

Commercials once again added considerably to longs while reducing shorts; Large Specs reduced longs but added to shorts, becoming very close to square. Small Specs again reduced longs somewhat, and again added to shorts. All sectors kept close to their previous share of the total market, with the comparatively high proportion held by Small Specs indicating continued choppy trading. 

Even though Tuesday's close was down from the previous week, at a recent low of 1.5660, the market has rallied since then to close on Friday around 1.5800. The latest COT figures, with Commercials going longer and Small Specs going shorter, continue to suggest steadier conditions for the Pound. 

COT data of Jan 29th 2013 - British Pound [BP]

British Pounds - Total o/i rose, to 166060, with spreads also higher, at 3248 (2.0% of the total).
 

Nett differences:

Commercials +140 (from -23389).  Large Specs +10622 (from +17938).  Small Specs -10762 (from +5451). Commercials moved to nett long (although only barely) - the first time since mid-August of last year.

Small Specs went nett short, also for the first time since August 2012.

 

Proportions:  

Commercials (52.2% of total o/i) - 52.3% of Longs, 52.2% of Shorts, balance plus 0.1 

Large Specs (32.4% of total) - 35.6% of Longs, 29.1% of Shorts, balance plus 6.5

Small Specs (15.4% of total) - 12.1% of Longs, 18.7% of Shorts, balance minus 6.6 

Commercials again added considerably to longs, and reduced shorts; Large Specs reduced both longs and  shorts, becoming less long overall. Small Specs reduced longs noticeably, and also added to shorts - even though their share of the total market remained little changed, their proportion of shorts (in conjunction with the fact that Commercials went nett long) creates danger signals. 

Tuesday's close was down from the previous week, at 1.5765, but since then the market has proved highly erratic, bouncing from around 1.5700 to almost 1.5900 before falling again. Based on the COT figures (and although fundamental backing seems absent), we continue to look for steadier conditions for the Pound.