– Ole Hansen, Head of Commodity Strategy, Saxo Bank
Key points:
● Our weekly Commitment of Traders update highlights futures positions and changes made by hedge funds across forex and commodities during the week ending Tuesday, 7 April 2026.
● In FX, the rush to the most liquid safe-haven asset saw the USD long jump 53% to a 14-month high, led by CAD, JPY and EUR selling.
● An elevated WTI and Brent long near a four-year high helps explain part of the 16% price slump that followed the US-Iran ceasefire announcement last Wednesday.
● The gold long slumped to a 25-month, while surging fuel prices underpinned demand for soybean oil (bio-fuel), and cotton in shift to the natural fiber from synthetics
Forex:
The latest report showed a 53% jump in gross USD longs versus eight IMM futures to $17.5 billion – a 14-month high – up from a $19 billion short just before the Middle East conflict began, highlighting a sharp shift into the most liquid safe-haven asset. This buying occurred despite a small net loss in the dollar on the week, with that weakness accelerating following the Iran–US ceasefire announcement.
All eight currency contracts saw net selling, led by CAD ($1.7bn equivalent), JPY ($1.6bn), and EUR ($1.2bn). This resulted in the euro position flipping to a 7.5k contract net short – the first in 14 months – and down sharply from a February peak of +180k contracts, marking a €23.5 billion swing.
Commodities
The latest COT reporting week to 7 April saw the Bloomberg Commodity Index rise 2%, with gains in livestock and, in particular, energy offsetting weakness across precious metals, grains, and softs. Once again, the primary focus was the energy sector, where the BCOM energy index jumped 6.4%, led by WTI and gasoil (diesel).
In response, managed money traders—including hedge funds and CTAs—maintained a total net long near a four-year high, just ahead of the US–Iran ceasefire announcement. This positioning helps explain part of the subsequent 16% price slump, reinforcing the view that the sharp decline was primarily driven by an overcrowded long rather than any meaningful easing in underlying fundamentals, which continue to point to a tightening physical market.
Across benchmarks, positioning developments were mixed but remained elevated overall. In WTI (ICE + CME), the net long increased by 5.5k to 109.2k contracts, while Brent saw a modest 5.6k reduction to 424.3k, leaving the combined total near a four-year high at 533.5k contracts. A long-short ratio in Brent at 11.3, compared with just 2.6 in WTI, underscores that Brent remains the preferred contract for expressing tightness.
While the ceasefire triggered a sharp correction in the paper market, it has yet to materially alter the physical backdrop. Key indicators—such as elevated prompt spreads and the continued premium in Dated Brent relative to futures—highlight ongoing and, in some cases, rising supply constraints. As such, any additional downside from here is likely to reflect further positioning clean-out rather than a deterioration in core market fundamentals.
Elsewhere, the following developments stood out:
● Gold length was cut to 92k contracts, a 25-month low, with bullion last trading near USD 2,000/oz when leveraged participation was similarly subdued.
● Soybean oil net length reached a fresh record at 150.7k contracts, driven by its biofuel linkage to surging fuel prices.
● Besides soybean oil, the grains sector saw its first week of net selling in 12 weeks, with the combined net long across six major contracts falling from a four-year high to a still-elevated 662k contracts (USD 26 billion notional).
● Cocoa shorts rose to a November 2022 high of 16.4k contracts as prices retreated toward three-year lows near USD 3,250—down around 75% from 2024 highs.
● The cotton short was reduced to near neutral – the smallest in two years – supported by strong price gains, as rising oil prices drive substitution from synthetic fibres such as polyester toward natural fibres.
