Interest in the safe haven Japanese yen continued to remain relatively high compared to demand in other major currencies for the week ending November 8th.  According to the CFTC’s Commitment of Traders report, the Japanese yen continues to maintain the largest net long position against the US dollar – about $4.5 billion.  The figure represented an additional $383 million that was added over the course of the week.

Interestingly enough, JPY longs are continuing to grow even as Bank of Japan policymakers threaten markets with further intervention efforts.  But, given the fact that the USDJPY currency pair is now closing back in on prior intervention levels near 76.00, we may see some profit taking ahead of this level.  Currently, the USDJPY exchange rate is trading at 77.06.

Australian dollar demand held the second largest net long positioning against the greenback, rising by $136 million to a total outstanding net long $2.8 billion.  This is somewhat counterintuitive considering what we have been seeing in the money markets.  Traders have tried to pare back on long Aussie spot trades as probabilities increase of a near term rate cut by the Reserve Bank of Australia.  Nonetheless, long positioning may increase in the coming week as the exchange rate currently tests support at 1.0100.

Notably, the market saw a massive exiting out of British pound shorts, to the tune of about 40% over the last week.  Now, with just barely $3 billion in net short positioning, it seems that the underlying spot rate may be up for a last ditch push higher till the end of the year.  The idea is likely to be propagated by an acceptance of unchanging monetary policy and a pickup in underlying economic fundamentals.