What Is Net Positioning in the COT Report?

What is net positioning? It is one group of traders’ long contracts minus its short contracts in one futures market. Say leveraged funds hold 90,000 long euro contracts and 60,000 short: their net position is +30,000, so as a group they gain when the euro rises.

It is the number most people take from the weekly COT report, because it boils a whole group down to one side and one size. The leveraged funds’ net position in every major currency is on COT report for forex, week by week on each currency’s page, such as the Australian dollar COT report.

Whose position?

A net figure means nothing until you know whose positions it counts. The Traders in Financial Futures report, the one that covers currency futures, has four groups: dealers, asset managers, leveraged funds and other reportables. In the same week they often lean opposite ways in the same currency.

So “positioning is short the euro” is half a sentence. Most forex traders mean the leveraged funds, the hedge funds and money managers. COT Report Explained shows a euro week where the groups pointed in opposite directions.

Look under the net

Leveraged funds were net short about 35,000 euro contracts on Tuesday 21 January 2025. By 8 April they were net long about 33,000 (CFTC TFF data). Over the same weeks the euro went from $1.04 to $1.09 at the Federal Reserve’s noon rates (Fed H.10).

That is a swing of about 68,000 contracts. Now split it into the two numbers it is made of. The funds’ longs rose by about 13,000. Their shorts fell by about 55,000. So four-fifths of the swing was funds closing bets against the euro, and only a fifth was new bets for it.

That difference matters for what comes next. A short that closes is a buyer used up, and once the shorts are gone, that source of buying is gone with them. New longs are a fresh commitment. The net figure alone does not tell you which of the two you got.

The sign changed in the report for 18 March 2025, from net short about 6,000 to net long about 14,000, in a week when the funds closed about 23,000 short contracts. If you read only the net, the funds turned bullish on the euro that week. Mostly, they stopped being bearish.

That was one flip, and flips go both ways. From June 2006 to October 2026 the leveraged funds’ net position crossed zero from one week to the next 602 times across the eight markets on the COT pages of this site. In 56% of those weeks, closing the old side did more of the swing than opening the new one. In the other 44%, new positions did more. In the euro it was almost exactly half.

That count compares, for every such week in the CFTC TFF data, the fall in the side being closed with the rise in the side being opened. A flip on its own does not tell you which kind you have; the longs and shorts do.

Size against the market

That January net short of 35,000 contracts sounds large. With about 609,000 euro contracts open that week, it was under 6% of the market.

On 9 July 2024 leveraged funds were net short about 111,000 yen contracts, with about 349,000 open: nearly a third of the market. In raw contracts the two positions are about three times apart. As a share of their market, the yen short was more than five times the euro one. The contracts are not even the same size: one euro contract is €125,000, one yen contract ¥12,500,000.

That is why you compare a net position with open interest and with its own history, which is what a percentile or a z-score does. What happened to that yen short is in COT Data Reversals.

Two easy misreadings

• Getting the yen the wrong way round. A yen future is a contract for yen, so a net short in yen futures is a bet on a weaker yen. Against the dollar, that is USD/JPY going up on your chart.
• Reading a large position as a reversal call. Positioning can stay stretched for months while the trend runs on. A big net position says the trade is heavily owned, not that today is the turn.