AUD/USD flows: Spec positions super-stretched into pullback, GBP trimmed
IMM positions data showed mkt was stretched long AUD into pullback, albeit partly offset on cross
GBP shorts trimmed after positioning into anticipated political event
Overall, mkt was light dollars into any volatility pick up
IMM data underscored again how very stretched AUD spec long positioning had got into the recent pullback, highlighting the scope for position driven adjustment given the right risk-aversion trigger.
Indeed, compared to trend, longs were standing at some +2.8 standard deviations to norm so on the extreme side (albeit part of that being a cross trade against NZD shorts, which does offer some net positional offset).
Elsewhere data again more broadly reinforces the point that the market is, overall, light dollars and so prone to a bit of a not-exactly-squeeze per se but forced position build, by a spike in volatility and risk reduction trade.
GBP shorts meanwhile were slightly pared, so saw a bit of squaring / profit-taking depending on initiation on the very anticipated event driven action.
