The amount of speculators’ bearish, or short, positions in 30-year Treasury futures exceeded bullish, or long, positions by 230,312 contracts on Oct. 6, a record, according to the CFTC’s latest Commitments of Traders data.

The 30-year yield, which moves inversely to prices, has rallied to a four-month high since August, when Federal Reserve Chair Jerome Powell announced that the central bank would allow periods of higher inflation in order to average its target 2% rate.

Bets on lower bond prices have also been fueled by expectations that the nascent U.S. economic recovery will continue, as investors await an additional round of fiscal stimulus from lawmakers and breakthroughs in the search for a vaccine against COVID-19.

The 30-year long bond yield is about where it was on March 6.

Yet speculators keep piling on with record bets.

Any bit of sustained economic weakness will cause the long bond yield to drop blowing the long bond shorts out of the water.

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Oct 6 (Reuters)The Thai baht’s resurgence this week has wrong-footed bears focused on domestic political unrest and weak prospects for its tourism-reliant economy , and further gains are likely as a new finance minister takes the helm.

An Oct 1 Reuters FX positioning poll showed investors turning bearish on the THB , but the currency has rallied 1% versus the USD since Friday, and could appreciate further. USD/THB broke below its 200-day moving average and Ichimoku cloud support zone on Monday. The next sell signal would be entry into the Bollinger downtrend channel at 31.20.

The move was driven by a bounce in risk assets on news of U.S. President Trump being discharged from hospital after receiving COVID-19 treatment . But the appointment of Thailand’s new finance minister also mattered .

Following the sudden resignation of his predecessor on Sept 1, the selection of transport minister and former state planning agency chief Arkhom Termpittayapaisith has helped restore some confidence as Thailand tackles its worst economic crisis in 22 years .

More fiscal stimulus could be on his agenda [nL3N2GK1XX]. While any positive measures may take time to materialize in economic data, for now, the charts say USD/THB bulls are looking long and wrong.

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(Ewen Chew is a Reuters market analyst. The views expressed are his own.)


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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