According to data from the Commodity Futures Trading Commission released last Friday, many currency speculators had cut their hedging, favoring the US dollar for the second straight week. The value of the net position of the US dollar fell to US$28.28 billion in the week ending June 11, 2013.

In the previous week, the net long position was at US$39.12 billion. On the other hand, the net short position for the Japanese yen fell to 72,906 contracts from the previous week's 82,744. In the week ending May 28, the net short contracts had a volume of 99,769, the highest in the past four years according to Reuters collated data.

Across the pond, Euro net shorts fell to 7,533 contracts from a high of 51,621 contracts just last week. The major changes were due to the dollar valuations of the US net long positions.

In forex parlance, to be short in a currency means the investor is betting the decline of the value of the currency while being long is to hedge that the value would rise.