USD sentiment had firmed up in the early part of this year; Friday’s CFTC data show large speculative trading accounts have slashed EUR longs and shifted to a small net USD long in aggregate through mid-February, the first bullish bet on the USD since November. However, risk reversals suggest weakening demand for topside USD protection in the past couple of weeks, rather suggesting there is little or no faith in the USD’s new year rebound being sustained. That would be in keeping with the typical seasonal pattern of trade (early year gains in the USD typically give way to weakness in Q2/Q3). 

USD losses so far this week warrant attention as some currencies are starting the threaten the weak trend in place since the start of the year.