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EUR/USD has regained its traction and climbed above 1.1000 after having declined toward 1.0950 with the initial reaction to the upbeat April jobs report from the US. The positive shift seen in risk sentiment ahead of the weekend weighs on the USD and helps the pair edge higher.
GBP/USD has gathered bullish momentum and advanced beyond 1.2600. Following the strong employment data from the US, Wall Street’s main indexes opened decisively higher on Friday, causing the US Dollar to lose its footing and fueling the pair’s rally.
Gold price came under heavy bearish pressure and tested $2,000 before recovering to the $2,010 area. After the data from the US showed that Nonfarm Payrolls rose by 253,000 in April, much higher than the market consensus of 179,000, the 10-year US T-bond yield surged 2%, causing XAU/USD to turn south.
The United Kingdom Commodity Futures Trading Commission (CFTC) released its Commitments of Traders report for the British Pound (GBP) on Tuesday showing that the Net Positions held by traders declined from the previous week’s figure of £5.8K to a much lower level of £1.1K. The report showed that the majority of traders continued to hold short positions in the GBP, with a net short position of £3.0K.
This decrease in net positions suggests that traders are less bullish on the strength of the GBP relative to other global currencies. This sentiment has been reflected in the performance of the currency in recent weeks, with the GBP weakening against the US Dollar and Euro. The decrease in net positions can be attributed to several factors, including concerns about the UK’s economic outlook and the continued uncertainty surrounding Brexit.
The CFTC report also revealed that Non-Commercial traders increased their long positions in the GBP from the previous figure of £807K to a higher figure of £865K. In contrast, Non-Commercial traders decreased their short positions from £1.902M to a lower level of £1.892M. However, Commercial traders continued to maintain a net short position of £1.9M in the currency.
Overall, the decrease in net positions held by traders indicates a decrease in optimism towards the GBP as traders become more concerned about the potential risks associated with Brexit and the UK’s broader economic outlook. As a result, it is likely that the GBP will continue to weaken against other major currencies in the near future.