Given that the majority of the reporting week covered the election uncertainty with a winner not declared until November 7th. The latest CFTC update covering up to November 10th saw little changes in USD positioning with net shorts against G10 FX rising by a marginal $69mln. That said, the preferred trade had been to flock to the safe-haven Yen with net longs jumping by $1.6bln (+8% of open interest). In turn, investors had been the most bullish on JPY since November 2016. However, given the vaccine optimism stemming from Pfizer it is likely that a sizeable amount of JPY longs would have been unwind, particularly as risk sentiment and US bond yields firm.
Positioning in GBP grew more bearish as net shorts picked up by $550mln, net shorts now at the largest since August. Although, while sentiment in GBP has softened, the additional bearish bets adds more fuel for a GBP rally in the event of a EU-UK breakthrough in trade talks. Elsewhere, bullish positioning in the Euro continued to be unwound, however, this looks largely to have been against the Japanese Yen. The Euro has maintained a 1.16-1.19 range, however, the outlook is likely to grow more bullish with a break above 1.1920.