Heavy speculative positioning in the euro
Societe Generale Research discusses the latest EUR positioning.
"The chart shows the trade-weighted euro in real and nominal terms, against CFTC positioning, showing net speculative longs as a percentage of open interest. It just gets more extreme. The 'real;' euro isn't nearly as stretched as the nominal one suggests but the market is very long," SocGen notes.
"The Recovery Fund was a significant step in the right direction for Europe, and we have a very non-consensus view of Europa/US growth differentials that underpins a long-term bullish euro view. But as Covid spreads along the summer vacation hotspots in Europe, we still think this move has gone too far, much too fast," SocGen adds.