By CountingPips.com
The most recent Commitments of Traders (COT) report released on Friday showed that futures speculators increased their bets for the U.S. dollar against the euro for the first time in seven weeks. The COT data as of August 17th, released by the Chicago Mercantile Exchange showed that non-commercial futures positions, those taken by hedge funds and large speculators, were net short the euro against the U.S. dollar by -14,627 contracts. This is an increase of 10,896 contracts after being net short the euro by 
-3,731 contracts the week before on August 10th. Euro short positions had declined for six consecutive weeks and on August 10th marked their best showing since the week of December 8, 2009 when positions were short by -511 contracts.
The COT report is published every Friday by the Chicago Mercantile Exchange (CME) and shows futures positions as of the previous Tuesday. It can be a useful tool for traders to gauge investor sentiment and to look for potential changes in the direction of a currency or commodity. Each currency contract is a quote for that currency directly against the U.S. dollar, where as a net short amount of contracts means that more speculators are betting that currency to fall against the dollar and net long position expect that currency to rise versus the dollar.
The euro and the British pound sterling were the only major currencies on the short side against the dollar last week in the CME futures market. The Australian dollar, New Zealand dollar, Japanese yen, Swiss franc, Canadian dollar and Mexican peso all continued to have a net long amount of contracts.
The British pound sterling numbered 4,431 short positions as of August 17th after being on the long side on August 10th with 5,021 long positions. The turn back to a net total of short positions reverses five straight weeks of improvements for British pound positions against the dollar.
Swiss franc long positions, which moved over to the long side against the dollar in the middle of June, rose to 11,750 long contracts as of August 17th after falling to 10,901 long contracts the week prior.
The Japanese yen net long contracts edged lower last week to 49,969 from 52,478 net long contracts on August 10th. Yen positions have made a substantial rise from May after being short by -65,612 contracts on May 4th.
The Australian dollar futures positions continued to advance and gained for sixth straight week. Aussie contracts were net long by 57,697 contracts as of August 17th following a net of 54,370 long contracts on August 10th. New Zealand dollar futures positions edged lower for second week with 12,139 long contracts after a total of 12,544 long contracts as of August 10th.
The Canadian dollar long positions fell to a net of 29,514 long contracts after 41,179 net longs the week before while Mexican peso long contracts also dipped after gaining for five straight weeks to 70,553 longs from 72,369 longs the week prior.
COT Data Summary (Net Positions vs. the US Dollar) as of August 17th, 2010
Euro: 14,627 short contracts from 3,731 shorts on August 10th
British pound sterling: 4,431 short contracts from 5,021 long contracts
Australian dollar: 57,697 long contracts from 54,370
Canadian dollar: 29,514 long contracts from 41,179
Japanese yen: 49,969 long contracts from 52,478
Mexican peso: 70,553 long contracts from 72,369
New Zealand dollar: 12,139 long contracts from 12,544
Swiss franc: 11,750 long contracts from 10,901
