US Dollar Index: US Dollar index futures positioning flipped to negative for specs and implieds are now at -137,083, which as an absolute value is in the 92nd percentile over the past 26 weeks (half of a year).  Our last extreme implied positioning (weâ�,��"�ll define extreme as > 90th percentile) was in November 2005 when implieds were 149,325 long.  This extreme positioning called the top in the USD index for the week ended 11/25/2005.

EUR: Euro futures positioning remains extreme with the difference between commercials and speculators increasing to 173,472 from 157,472 the prior week.  Specs increased net longs by 8,949 to 74,474.  In fact, this is the longest that specs have ever been.  The difference between commercials and specs is also the largest ever at 173,472.  The previous record was last week but the one before that was 139,838 in November 2004, a bit more than a month before the all-time high of 1.3666.  The extremity of the data suggests that we are nearing a top in EUR/USD.

GBP:  Cable traders remained net long after flipping to net long 3 weeks ago.  We mentioned last week that â�,��"the increase in longs is accompanied by an increase in open interest of 10,380â�,�¦.This bodes well for bullsâ�,�¦â�,�.  Specs added to longs by 6,334 and are now 18,624 long.  The difference between specs and commercials is coming close to an extreme difference with the difference at the 76th percentile (measuring over the last 26 weeks).

CHF: CHF specs cut shorts by 11,800 and are now short 12,629.  This is expected as USD/CHF declines and traders jump on the CHF bandwagon.  Commercials cut longs by 15,222 and are now long 11,435.  Since the last extreme reading was in late February when specs were extremely short CHF, the path of least resistance (as suggested by COT data) is still towards CHF strength over the long term.  

JPY:  We mentioned lat week that â�,��"Expect JPY specs to flip to net long soon, which is consistent with commercials being short, as well as a strengthening JPYâ�,�.  The Yen has rallied ferociously and specs are now long 2,689.  Like CHF futures, the last extreme positioning was in late February and thus the bias towards Yen strength began.  The bias is made stronger by the fact that specs have flipped to net long JPY.  Conditions do not change until extreme data is present.

CAD:  CAD traders added to long positions by 16,529 and are now 32,152 long.  With commercials net short 49,820, the difference between specs and commercials is now 81,972.  However, extreme readings in difference in CAD futures are > 100,000 and until then, COT data lends a bullish CAD (bearish USD/CAD) bias.

AUD:  AUD traders added to long positions by 14,016 and are now long 21,773.  The difference between specs and commercials is now 54,764, which is in the 92nd percentile over the past 26 weeks and thus is extreme.  Such instances often are accompanied with market turns and with specs long AUD, the extreme positioning gives scope to a reversal in AUD/USD.

Jamie Saettele is a Technical Currency Analyst for FXCM.