The latest Commitment of Traders (CoT) report released by the ICE platform on Wednesday morning indicates that investment funds resumed reducing their net long positions — the difference between long and short positions — after briefly pausing the decline the previous week.

According to market data available as of last Friday, net long positions decreased by 2 million allowances compared with the previous week, marking a decline of approximately 5%. As a result, total net long exposure fell to 38.66 million allowances.

Net long positions peaked in mid-January at around 126 million allowances. Since then, they have declined by roughly 70%, pointing to a sharp deterioration in investor confidence regarding further upside potential and signalling a more bearish outlook for EUA prices.

The decline in net length was primarily driven by a significant reduction in long positions, which fell to 61.4 million allowances — the lowest level since mid-August. In contrast, short positions remained broadly stable, posting only a modest increase of 0.59 million allowances over the same period.

Notably, aggregate market exposure — measured as the combined total of long and short holdings — has contracted significantly in recent months, falling from a record 180.5 million allowances in mid-January to just 84.1 million allowances, marking the lowest level in almost two years.

A low level of aggregate exposure generally reflects a more cautious and defensive sentiment across the market, a trend that is also supported by recent market data showing that prices remained largely stable over the past week, fluctuating within a relatively narrow trading range.