Small specs speak again

On Mar3rd, we noticed that small speculators, according to the COT report, are holding relative large net short positions on Yen. Given their poor trading track records in the past, we would be better to take new buy signals only. So far, $/Yen has failed to break the 120 level again for the past two weeks, trading at 117.80, or 8604 June futures, today. Now, let's see what are they doing on the european currency, say Swiss France.

We have the weekly closing line at the upper panel and the COT Small Spec index at the lower panel of the chart. Based on the latest figures, the index is sitting at the very bottom indicating they are holding relatively large net short positions on SF. That implies they are extremely bearish on SF, or bullish on dollar. Being a contarian we would expect a trendline breakout to confirm the reversal to the upside in the coming two weeks.