For the first time since December 2005, futures traders are turning bullish on the dollar.

The difference in the number of wagers by hedge funds and other large speculators on a gain in the greenback versus the euro, known as net longs, was 21,315 on April 29, figures from the Commodity Futures Trading Commission in Washington show. There were net-short positions in each of the previous 123 weeks. At the same time, traders have stepped up their purchases of options that profit from the dollar's appreciation.

The measures are making long-suffering proponents of the dollar optimistic that this time the currency's rally may hold, especially if the Federal Reserve's Open Market Committee refrains from additional interest-rate cuts. The Dollar Index traded on ICE Futures in New York, which tracks the currency against six trading partners, is up 3.7 percent from an all-time low of 70.698 set on March 17.

``There is kind of a sea change taking place at the moment,'' said Mitul Kotecha, head of foreign-exchange research in London at investment bank Calyon, whose forecasts on the euro-dollar exchange rate in the first quarter were more accurate than those of the two biggest currency traders. ``It's probably the early sign of perhaps a more sustained turnaround.''

The Dollar Index rose 0.4 percent to 73.296 by 9:42 a.m. in London. The dollar has appreciated 3.8 percent to $1.5385 since dropping to $1.6019 per euro on April 22, the lowest since the European currency's debut in 1999. The dollar will strengthen by the end of the year to $1.50, according to the median estimate of 40 strategists surveyed by Bloomberg News.

Gaining Traction

The dollar's rebound gained traction last month after the Open Market Committee said ``substantial'' rate cuts since September would help foster growth. U.S. employers also eliminated fewer jobs in April than forecast by economists.

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