The risk of further EUR/USD losses towards 1.12 will increase if a material number of euro long positions are ditched over coming days and weeks.
Friday's CFTC data showed IMM speculators upped gross EUR long positions by 16,534 contracts in the week to Sept.
This raised the net EUR long position to 190,822 contracts -- which is only 21,000 less than last month's record high. nL1N2GP03P
The bullish shift in EUR positioning preceded the EUR/USD drop to a nine-week low near 1.16 at the end of last week.
At the start of this month, EUR/USD traded above 1.20 for the first time since May 2018: on Sunday, ECB policymaker Ignazio Visco said a recent strengthening in the euro's exchange rate is a worry. nL8N2GO0FI
EUR/USD was last at 1.12 on July 1 -- before EUR/USD gains influenced by a perception that the euro zone was handling the COVID-19 pandemic better than the Unites States.
That perception is no longer the case. nL8N2GP1TI
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