Investing.com — Trading Advisors (CTAs) maintained a strong long position in the US Dollar, as shown by the relative upward movement in both the Dollar and the benchmark CTA index last Thursday, according to Bank of America.
This trend has been consistent, with the dollar showing gains in the past five weeks and 13 of the last 14 weeks.
In the past two weeks, it has been noted that some trackers may be offering more risk to foreign exchange (FX) as its trend is stronger than equities, bonds and commodities. This can be a major issue, as the reversal of the Dollar and the reduction of the following CTA is more likely due to the increase in risk allocation.
Next week, it is expected that the fan of short positions in the Japanese Yen will increase. It was noted that the Brazilian Real was recently added to the daily update, and the model shows that if CTAs are active in that market, they will be long on the Dollar against the Real.
According to the model, trackers are likely to be long on the NASDAQ-100, but their position is at a higher level due to lower inflation and higher volatility. The NASDAQ-100 sales trigger in the model shows that the sales follower can be strengthened if the level reaches 20880.
In terms of , if the long position is still there, it should be close to hitting in the near term. Outside the US, CTAs appear long and neutral in the future.
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