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10 Dec 2014
AUD long positions fell drastically in October – Nomura
FXStreet (Barcelona) - The Research Team at Nomura shares the Australia/NZ and Japan flows, noting that AUD long decreased from JPY 737.7bn in September to JPY 328.0bn in October.
Key Quotes
“According to data from the Financial Futures Association of Japan on over-the-counter FX margin trading, retail investors were net long AUD by JPY328.0bn in October, a sharp decrease from net long position of JPY737.7bn in September. Retail investors were net long JPY180.8bn of NZD in October, also down from September‟s net long position of JPY260.7bn.”
“The ratio of net long positions (ratio of long positions less ratio of short positions) held by retail investors fell sharply into end-October for both AUD/JPY and NZD/JPY, according to Gaitame.com. We attribute this to the sharp rise of USD/JPY following the BOJ‟s adoption of QQE2, in addition to a new portfolio allocation by the Government Pension Investment Fund (GPIF), both of which occurred on 31 October. This caused AUD/JPY and NZD/JPY to rise sharply as well, which prompted retail investors to take profits.”
“Since early November, the ratios of net long positions for AUD/JPY and NZD/JPY have moved differently. While investors closed long AUD/JPY positions aggressively into mid- November, the ratio of net long positions rose into end-November, albeit slowly. We attribute the movements in AUD/JPY to retail investors, who took profits on their long positions and looked to go long AUD again.”
“In contrast, investors continue to shed long NZD positions aggressively. Although momentum is slowing, there are few signs that these investors are adding back NZD assets, as they have done with AUD. We believe this may be because investors opened long NZD positions the most since 2009, making it likely that many are still in profit.”
Key Quotes
“According to data from the Financial Futures Association of Japan on over-the-counter FX margin trading, retail investors were net long AUD by JPY328.0bn in October, a sharp decrease from net long position of JPY737.7bn in September. Retail investors were net long JPY180.8bn of NZD in October, also down from September‟s net long position of JPY260.7bn.”
“The ratio of net long positions (ratio of long positions less ratio of short positions) held by retail investors fell sharply into end-October for both AUD/JPY and NZD/JPY, according to Gaitame.com. We attribute this to the sharp rise of USD/JPY following the BOJ‟s adoption of QQE2, in addition to a new portfolio allocation by the Government Pension Investment Fund (GPIF), both of which occurred on 31 October. This caused AUD/JPY and NZD/JPY to rise sharply as well, which prompted retail investors to take profits.”
“Since early November, the ratios of net long positions for AUD/JPY and NZD/JPY have moved differently. While investors closed long AUD/JPY positions aggressively into mid- November, the ratio of net long positions rose into end-November, albeit slowly. We attribute the movements in AUD/JPY to retail investors, who took profits on their long positions and looked to go long AUD again.”
“In contrast, investors continue to shed long NZD positions aggressively. Although momentum is slowing, there are few signs that these investors are adding back NZD assets, as they have done with AUD. We believe this may be because investors opened long NZD positions the most since 2009, making it likely that many are still in profit.”