Summary: Our weekly Commitment of Traders update highlights futures positions and changes made by hedge funds and other speculators across commodities and forex up until last Tuesday, May 10. A week that saw continued risk off as the combination of high rates and potential recession as inflation surges kept stocks under pressure while lifting bond yields and the dollar. Commodities hurt by the prospect for lower growth, most critically in China, saw broad selling with funds cutting their exposure to a 21 month low. Focus on copper with funds doubling their short position ahead of a potential easing of lockdowns in China

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This summary highlights futures positions and changes made by hedge funds across commodities and forex up until last Tuesday, May 10. A week where a continued sell off in global stocks pushed the S&P 500 below 4,000 for the first time in more than a year while US bond yields climbed to a fresh cycle high. Financial markets have become increasingly challenged by a combination of high rates and a potential recession as inflation surges. In addition the wind has come out of the commodity bull market with China, a major consumer, paying an increasingly high price for its Covid Zero Policy. Adding to this continued dollar strength, and most asset classes from bonds and stocks to cryptos and commodities remain under pressure, and speculators in commodities and forex have adjusting their positions accordingly.

Commodities

The Bloomberg Commodity Spot index dropped 3.1% on the week with losses in energy (-4%), industrial metals (-6.1%), precious metals (-2.5%) and softs (-3.7%) while grains managed a small plus led by wheat. Overall hedge funds and money managers responded to these changes by cutting bullish bets across the 24 major futures tracked in this by 9% to a 21 month low at 1.68 million lots, a 25% reduction since the recent peak in late February.

Twenty out of 24 commodity futures tracked in this update traded lower on the week with eighteen of those seeing positions being reduced with four commodities seeing position levels drop to the lowest in at least a year.

https://www.fxmag.com/commodities/cot-copper-short-doubles-in-week-...