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Dunstan

Follow the Smart Money / COT Analysis

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Hi Dunstan,

no, I do not have experience with the new report.

To be honest, I do not trade.

I found one service promising to show us how the new report use.

So I am curious if you have some experience with that.

Thanks

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Unfortunatelly I don't have any experience using the disaggregated report, but hopefully someone who has will join this thread soon and can share with us some useful info on it.

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Hi everyone,

 

Let me share with you the link to the latest [ame=http://www.youtube.com/watch?v=ca0_6yRgXoc&feature=g-all-u]Commitments of Traders review[/ame]!

 

I would like to start with Wheat, since I was talking about it the last time already.

 

As the attached chart shows, nothing really changed in the picture since last week, we are still at an extreme in the COT, which – studying the past similar cases – seems to be a good short opportunity. Of course I know that some of you might want me to give exact entry levels, TP levels and stop levels, but instead I would just recommend you to have a look at other posts in the forum, where they might talk about systems, strategies that can offer a tool for such a situation. All I wish to highlight here is that Wheat is a market these days/weeks, where market participants are holding positions that are extremely long/short compared to their history. This is sort of a bubble that will burst sooner or later and it is advised to have one eye on it these days…

 

Live Cattle I think is also interesting. It was mentioned in the review, because Commercials changed their net position, further increased it by 16%. It is interesting really that Commercials and Large Speculators are both net long, while Small Speculators are the only ones net short in the market.

 

Of course as said in the review, a lot of Small Speculators are actually Commercials, they just don’t reach the so called “reporting limits”. If you look at the chart of Commercials and Small Speculators, you should see that the two lines have a strong correlation.

 

Looking at the picture, I would say that it is bullish, so if you were already long this market, you might want to stay in or if you were thinking of going short, this might not be the best time for that.

 

I am also open to discuss any particular market that you are interested in if you have any.

 

All the best,

Dunstan

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Hi everyone,

 

The latest Commitments of Traders review is out ([ame=http://www.youtube.com/watch?v=u5j25_f1sWA&feature=g-all-u]here[/ame])

The first market that was mentioned, was Lumber, where there was a larger than average change in Commercials positions. The longer, five year chart shows us that neither commercials nor large speculators are at extreme levels, it is only small speculators, who seem to be extremely optimistic about the market (COT Index at 99%).

 

The size of the change in positions is definitely large enough and this coinciding with extreme optimism from SS is not a bad combination for confirming a bearish trade.

 

Sugar was the next market. I think this could be another good example we can use to understand COT analysis better. If you look at the 5 year chart, it is clearly visible that there was a shift in the short term trend a few weeks ago, we have moved away from the relative COT extreme and there is plenty of space left to reach a new COT extreme Buy signal. The example illustrates well that we should be careful how we view a COT change signal during a trend. I believe – agreeing with the COT review – that this signal should not be taken seriously and the down trend can continue.

 

I will be showing some other markets shortly, meanwhile if you would like to check out the recent COT report on other futures markets, you can do so at this service that I’m also using.

 

Let me know if you are interested in any specific market, I’ll try to analyze it for you!

 

All the best,

Dunstan

Report33_Lumber_1yr.thumb.png.57aa27b35a5cd48c1cba1cb46d598d01.png

Report33_Lumber_5yr.thumb.png.346eb274e282f161fb3b730be94cb18a.png

Report33_Sugar_1yr.thumb.png.de13e2d532e2b5f7a877d2278057d185.png

Report33_Sugar_5yr.thumb.png.6c1493400d56b40845b5721154c9df23.png

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Hi everyone,

 

The latest Commitments of Traders review is out ([ame=http://www.youtube.com/watch?v=4jdvcBAE4-U&feature=g-all-u]here[/ame])

 

Silver

 

It was interesting this week that all over metals, there were pretty large changes in the positions that Commercials, Large Speculators and Small Speculators are holding. These changes can be considered sell signals, but I think we should realize, that 2 month ago , there was a pretty bullish picture in the COT report for these markets, especially one in Silver (26th report - Commercials at a 563 report COT Extreme). The question here I think is to determine the difference in the strength of the two signals. In my opinion, a COT extreme picture could have a longer lasting effect, while a COT change signal has a shorter one. So following this analogy, if one took the signal in the 26th report and went long in metals, than it could be a good time to realize some profits and re-enter in a few days, when prices have dropped a little, since the COT extreme should have enough momentum left to push prices higher. Of course this decision should be in harmony with one’s trading system’s money management rules and trading strategy.

 

I have attached a 5-year chart on the 26th report for Silver and the most recent one as well. It is clearly visible that during this 2 month, the COT picture has moved away from those extreme levels. I guess we can start talking about a bearish picture again, once Commercials have reached 50.000 or more contracts net short and Small Speculators are holding roughly 15-20 thousand (or more) contracts net long.

 

Canadian Dollar

 

The changes in positions amongst all participants were relatively large. In my opinion the best picture would have been if these changes took the COT report to the extreme territories that the review was talking about, Commercials net short 100.000 or more contracts and Small Speculators net long 35.000 or more contracts. The extreme combined with the change signal would have been a very significant sell signal, but of course this change on its own could also be strong enough to push prices lower.

 

I wish all of you good luck to this week’s trading,

All the best,

Dunstan

 

the original COT report --> here

COT charts (free) --> here

Report26_Silver.thumb.png.226a6bf5247e78b55ac662457bf93317.png

Report34_Silver.thumb.png.8070db7f63e70344a1b75dac8d06e47b.png

Report34_CAD.thumb.png.a7aa03dcb94a47de8db90c92fc323745.png

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Hi everyone,

 

The latest Commitments of Traders review is out ([ame=http://www.youtube.com/watch?v=R1wkDBFvJGk&feature=g-all-u]here[/ame])

 

Silver

Not much changed from last week, the size of change in positions C, LS and SS are holding changed a bit more than average (actually metals were on top again). After last week’s signal, prices did drop a bit, but the COT extreme buy signal that happened 2 month ago is still pushing prices higher. I can’ really add anything new to this compared to my 1 week ago post --> we need to wait for an extreme in COT to start thinking about a downward turn in prices.

 

Nasdaq-100

The COT extreme that can be found in this market is pretty significant. LS are at All-Time extreme levels, but also C and SS are close to their all-time levels as well. I’m not a “big fan” of COT signals in indexes, in my experience these are the weakest signals compared to other markets, but in this case it looks as if the signal could affect prices. I have tried to find similar cases on the chart to see what happened to prices back then (see attached chart) and I could find some working cases. The close resistance level is also favorable for traders seeking a short opportunity.

 

I wish all of you good luck to this week’s trading,

All the best,

Dunstan

 

the original COT report --> here

COT charts (free) --> here

Report35_Silver.thumb.png.62d9431d564b66a74952e1318498b483.png

Report35_Nasdaq-100.thumb.png.3d5c449735544747481e3a90f4802671.png

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Hi,

 

I’ve just received an e-mail from a fellow trader, who was asking me to write something about the relationship of cot data and currencies, so I thought I'll share it with you as well here at IT.

 

Well first of all, CFTC publishes COT reports on many currency futures, so the basic relationship is this; you can have a look at major market participant’s positions on these markets as well. Of course one might ask, “who are the Commercials here?” Actually they are companies, who do business internationally and require the usage of different currencies than the ones they are using at home, so they are exposed to currency risks.

 

Does COT analysis work on currencies? My answer is: YES

Let me show you a chart on AUD. I have indicated some places on the chart, where a turn in price direction coincides with some sort of extreme in the COT.

 

Of course if you would like to trade a pair, where both currencies have futures and COT reports on them, you need to analyze both of those markets’ COT report and come to conclusion, since we don’t have COT report on currency pairs.

 

A little analysis on currencies for you this week:

 

AUD

A COT Extreme Sell signal in the report --> COT Index: C - 12%, LS - 91%, SS – 65%. Prices have already started to decline, the recent top is not far if you were searching for resistance levels for your stop.

 

GBP

We have no COT Extreme in the market. What is interesting though is that last week only SS thought prices could go higher, C and LS both cut back on their net long positions (look at the 1 yr chart, I have indicated it).

 

CAD

The extreme here is not as big as in AUD, but still large --> COT Index: C - 22%, LS - 84%, SS – 62%. The question is, would this extreme in the COT widen more or is this a relative top in prices. If the next COT report shows us that participants are moving away from their extreme territories, I guess that would confirm the top. One thing is for sure: base on COT analysis, the picture now is more bearish than bullish.

 

EUR

There was an All-Time COT extreme buy signal not long ago (indicated on chart), but could not push prices higher. Since then, C,LS and SS have moved away from their extremes. The fact that LS are in a buying mood (cutting back on their net short positions) is a bullish signal, on the other hand if this direction in COT would start to change and we would be witnessing another move towards extreme territories, I would be expecting prices to decline some more and I would be looking for buying opportunities, when we have reached these extreme levels, I would say, C at net long >250 000 contracts, LS < 200 000 contracts and SS <40 000 contracts.

 

JPY, CHF

Nothing special, we don’t really have any COT signals now.

 

MXP

Similarly large COT extreme as in CAD --> COT Index: C - 23%, LS - 77%, SS – 67%.

The picture is bearish.

 

All the best,

Dunstan

Report35_AUD.thumb.png.b482b8f162e8d7686dee26e528246ab6.png

Report35_GBP_1yr.thumb.png.b71d4e0c0e5af536fd01faa029eeef19.png

Report35_GBP_5yr.thumb.png.d2c42d798f39a9ba007379392ecf9ba5.png

Report35_CAD.thumb.png.fcad4750f1f54ac8a1dce9b61a251a03.png

Report35_EUR.thumb.png.f25a3a4153cac1102748ae585968ee98.png

Report35_MXP.thumb.png.b66500cacc724a877cc51272e28bf6f2.png

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Hi everyone,

 

The latest Commitments of Traders review is out ([ame=http://www.youtube.com/watch?v=fP6Ceeqh6Gk&feature=g-all-u]here[/ame])

 

Silver

The size of change was again larger than average. Market participants have started to move towards their bearish extreme levels, although we are definitely further away from these levels than for example in Platinum.

 

Platinum

Large Speculators have reached an all-time net long position, which is an extreme COT signal, but as said in the review, the picture is not the same as in the previous two cases. The volume and open interest total score being 16 is a bullish signal and the fact that other metal markets are not at their COT extreme levels yet, suggests that the rally could continue, but we should be at the lookout for a possible down-turn.

 

Cocoa

The reason why it has been mentioned is the size of change that happened in Commercials’ positions, but what is interesting here is that Small Speculators are near extreme levels (COT Index 97%). The picture is becoming bearish.

 

I wish all of you good luck to this week’s trading,

All the best,

Dunstan

 

the original COT report --> here

COT charts --> here

Report36_Silver.thumb.png.f840060f9dfdbe1aab0abba6cfa3fc00.png

Report36_Platinum.thumb.png.dc2b3d838200dc754138aea73b4947e0.png

Report36_Cocoa.thumb.png.427c9203309fd258ac2f523325f055ac.png

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Hi everyone,

 

The latest Commitments of Traders review is out ([ame=http://www.youtube.com/watch?v=7u5LrUGJjZo&feature=g-all-u]here[/ame])

 

Copper

The size of change in C and LS positions was HUGE (!): 41% & 42%, but it was in a direction away from the recent extreme levels. This pushed market participant’s positions towards a more neutral zone. The hard question here to decide is whether to act on the large COT change signal and exit longs or even go short, when LS – the ones who we like to follow – are buying the market and actually just turned net long. Well, the change was definitely significant, so it should be considered a meaningful signal --> we should be careful in further buying the market, but on the other hand, we know that metals tend to correlate with each other. Let’s have a look at all the metal markets to see – by looking at the COT report – which ones are stronger and which one are weaker compared to each other:

 

Gold

SS signals in gold are usually pretty accurate, so the fact that they are at COT Index 96% is an exciting situation. I have indicated on the chart previous cases, when SS were at such levels to see what happened to price back then.

 

Silver

Although we cannot talk about an All-time or close to all time extreme picture, you can see on the attached chart, that in case of the last two relative tops in the market, market participants where at such levels.

 

Platinum

LS and C are at COT All-Time extreme levels, but SS are not at such levels yet. The picture is still more bearish than bullish.

 

Palladium

The COT Index shows us that neither participant is in their extreme zone. The Volume&OI score is the largest here. I would consider this market to be the strongest amongst metals.

 

Even though, we do not have a super clear picture (I would say all-time or close to all-time extreme levels amongst all market participants and all metal markets), overall, I think that we are becoming more bearish in metals day-by-day.

 

I wish all of you good luck to this week’s trading,

All the best,

Dunstan

 

the original COT report --> here

COT charts --> here

Report37_Copper.thumb.png.b52f7341d20d5a7348225948f215e81e.png

Report37_Copper_5yr.thumb.png.6209c97f1bb0f728358ee917682ef6ca.png

Report37_Gold.thumb.png.752fb2c2ea1471b1572fd2c4dd1501c4.png

Report37_Silver.thumb.png.4f206f247d7441b23034dde7ab5ea3dd.png

Report37_Platinum.thumb.png.cb5f2a61b998abdf6111e1377cebf9c5.png

Report37_Palladium.thumb.png.540e71d4d83bf891ddc67a74a8310094.png

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Hi everyone,

 

Just wanted to update you on metals, which I have analyzed for you in my last post. It looks like prices have started to decline, so it could be that my assumption on the general bearish picture in metals was correct. As the examples brought to you, showed clearly that we are not at all time extreme levels everywhere, there where relative extremes, which in the past had the strength to effect prices. It’s not an easy play, but I guess the Risk/Reward of taking the recent report’s signals was(is?) pretty good.

 

All the best,

Dunstan

metals.png.c62076ef07bc73e05fcf7f31f14164a1.png

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Hi everyone,

 

The latest Commitments of Traders review is out ([ame=http://www.youtube.com/watch?v=5So2amDeYKM&feature=g-all-u]here[/ame]).

 

USD Index

Very large Change in positions of C and LS --> 58% and 62%. This signal together with the COT extreme picture (see attached chart) suggests a bullish move in prices.

 

Coffee

The COT change signal that we had here points in the opposite direction as what the COT extreme picture suggests, but of course we should know by now that while a change signal has a faster effect on prices – if at all – extremes give you a better understanding on the wider picture. In this case Commercials being net long – as the review says correctly – is a bullish signal. If you look at the COT index, we can see that it confirms this --> C at 87% and L at 14%.

 

I wish all of you good luck to this week’s trading,

All the best,

Dunstan

 

the original COT report --> here

COT charts --> here

5aa711460d084_Report38_USDIndex.thumb.png.834a81c7c9276368b55049742a01e849.png

5aa7114614963_Report38_Coffee.thumb.png.1faf0a8e401fc41b4074c204972970b1.png

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Hi everyone,

 

The latest Commitments of Traders review is out ([ame=http://www.youtube.com/watch?v=2iQnRsGmuSg&feature=g-all-u]here[/ame]).

 

Cotton

COT Change / C-27%, LS-20%, SS-25% /

COT Index / C-88%, LS-10% /

The COT report suggests that there could be an increase in cotton prices in the near term and even in medium-long term as well.

 

Crude Oil

The change signal suggests a bullish move, but the general picture looks bearish.

 

British Pound

Small Speculators are at an All Time extreme level (their most optimistic mood ever), but also Commercials are heavily selling the market--> bearish picture.

I wish all of you good luck to this week’s trading,

 

All the best,

Dunstan

 

the original COT report --> here

COT charts --> here

Report39_Cotton.thumb.png.4ead321145688e9432464bad38dfd3c5.png

5aa7114e0c267_Report39_CrudeOil.thumb.png.5b7e9afc20c7284ecf538d797cd84a93.png

Report39_GBP.thumb.png.de3bc7828642f99fd22d41ecfbaf7969.png

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Hi everyone,

 

The latest Commitments of Traders review is out ([ame=http://www.youtube.com/watch?v=zZAALHaNmFk&feature=g-all-u]here[/ame]).

 

Natural Gas

COT Change (52W) / C-31%, LS-32%, SS-13% /

COT Extreme / C-230, LS-255 /

COT Index (3 year lb.) / C-0%, LS-100%, SS-69% /

The near term picture looks bearish, since the more than 30% changes that we can witness in C and LS positions are stronger than average signals. In medium to longer term (let’s say up to 6-9 month), I don’t see such an extreme picture yet, that would suggest the end of this increase in prices that started in mid April.

 

Cotton

COT Change (52W) / C-31%, LS-30% /

COT Extreme / C-281, LS-281 /

COT Index (3 year lb.) / C-100%, LS-0% /

The COT report suggests that there could be an increase in cotton prices in the near term and even in medium-long term as well.

 

Platinum

COT Extreme / C-All Time, LS-All Time /

 

Gold

COT Extreme / SS-All Time /

 

I wish all of you good luck to this week’s trading,

All the best,

Dunstan

 

the original COT report --> here

COT charts --> here

5aa71155bad88_Report40_NaturalGas_1yr.thumb.png.dc3067c0cdbf4a9c3d69e893cb03627c.png

5aa71155c17a0_Report40_NaturalGas_10yr.thumb.png.303558f6d26a49a634e600a3c76da840.png

Report40_Cotton.thumb.png.714abd93c79c1103566dd62379dc219d.png

Report40_Platinum.thumb.png.97a1014d81d4e39d74cc29a886451431.png

Report40_Gold.thumb.png.fd55f7efef1a42ccc52faa92e47ccd73.png

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We might be in for a ride down in gold

 

Hi everyone,

 

The latest Commitments of Traders review is out (

).

 

Natural Gas

COT Change (52W) / C-31%, LS-32%, SS-13% /

COT Extreme / C-230, LS-255 /

COT Index (3 year lb.) / C-0%, LS-100%, SS-69% /

The near term picture looks bearish, since the more than 30% changes that we can witness in C and LS positions are stronger than average signals. In medium to longer term (let’s say up to 6-9 month), I don’t see such an extreme picture yet, that would suggest the end of this increase in prices that started in mid April.

 

Cotton

COT Change (52W) / C-31%, LS-30% /

COT Extreme / C-281, LS-281 /

COT Index (3 year lb.) / C-100%, LS-0% /

The COT report suggests that there could be an increase in cotton prices in the near term and even in medium-long term as well.

 

Platinum

COT Extreme / C-All Time, LS-All Time /

 

Gold

COT Extreme / SS-All Time /

 

I wish all of you good luck to this week’s trading,

All the best,

Dunstan

 

the original COT report --> here

COT charts --> here

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Hi everyone,

 

The latest Commitments of Traders review is out ([ame=http://www.youtube.com/watch?v=8ibpcyTYbBI&feature=g-all-u]here[/ame]).

 

Dow Jones-30

Vol/OI Total Score /-15/

COT Change (52W) / C-26%, LS-22%, SS-33% /

COT Index (3 year lb.) / C-22%, LS-79% /

Although the Change signal was large and we can see some examples in the past, when prices reacted to it, what is concerning for me on the long side is the volume & open interest score and the COT extreme picture. Both of these are showing a bearish picture.

 

Australian Dollar

COT Change (52W) / C-19%, LS-17%, SS-25 /

Another example, when the change signal is pointing in the opposite direction as the general picture. Two weeks ago there was a close to All Time extreme COT picture that was a strong sell signal and started to push prices lower. Last week’s COT change signal could stop that decline and even redirect prices to higher levels. It could easily be, that prices continue their rise for a few days, but the fact the LS are heavily exiting their net long positions is a warning signal.

 

Platinum

COT Extreme / C-All Time, LS-All Time /

The picture has not changed, we could witness another All Time COT extreme this week. Stress levels are super high and this suggest a price decline soon.

 

I wish all of you good luck to this week’s trading,

All the best,

Dunstan

 

the original COT report --> here

COT charts --> here

5aa7115bc29b6_Report41_DowJones-30.thumb.png.0573d9165afc6cee349804842a3f8b72.png

Report41_AUD.thumb.png.490d6cab6a21e1482f598e0cf6526f49.png

Report41_AUD_5yr.thumb.png.a594a22ca2789e05fea6a54a956af6d4.png

Report41_Platinum.thumb.png.a24c5f6b00a5cf7c47ce637d93479fe6.png

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Hi everyone,

 

(sorry for the late update, I was away for a couple of days…)

 

The latest Commitments of Traders review is out ([ame=http://www.youtube.com/watch?v=-rYFiRGOM0g&feature=g-all-u]here[/ame]).

 

Cotton

COT Change (52W) / C-25%, LS-17%, SS-25% /

COT Index (3 year lb.) / C-88%, LS-10% /

The 25% change in Commercials positions could be considered a stronger than average signal and as we can see it by now (Wednesday) prices have declined on it. On the other hand, the wider picture shows an extreme in the market pointing in the opposite direction, upwards.

 

Heating Oil

COT Change (52W) / C-20%, LS-25% /

COT Extreme /SS-692report/

COT Index (3 year lb.) / C-5%, LS-79%, SS-100% /

A great example of multiple COT signals --> COT change and the extreme are bearish signals. From all the signals this week, I would consider this one to be the best opportunity trade (close resistance level, great Risk/Reward trade).

 

Platinum

COT Extreme / C-All Time, LS-All Time /

We can see the prices have started to drop heavily, so anyone following these signals could have made some serious profits by now.

 

I wish all of you good luck to this week’s trading,

All the best,

Dunstan

 

the original COT report --> here

COT charts --> here

5aa711667f196_Report42_Cotton1yr.thumb.png.24075e3ad1188a8c7c26eccd941fa4ec.png

5aa711668710e_Report42_Cotton5yr.thumb.png.2e808f2bcbc092520f4da19ea5dda416.png

5aa711668f00e_Report42_HeatingOil.thumb.png.07791bd59a9034a15a8cf5b73b5ee25f.png

Report42_Platinum.thumb.png.f3341bf709e8d085f743d9f708a4c959.png

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Those of us who actually trade for a living (some of us anyway), got short in the area of 1460 around the 18th Oct....my distribution shows the

resistance there and the market starts the process of rolling over....this is a seasonal move that we expect to happen at some point in October....with a potential low of 1360

 

Your very late to the party having missed little more than half the move...but then that is exactly how retail traders act...isn't it....you come in late, you get on board and then taking a beating as the market starts to correct back forth in a range....

 

While I am not trying to be critical...I do have to call it as I see it....the COT is valuable in hindsight...but the report comes public way to late to be actionable in most markets....

 

The first attached chart provides all the heads up you need if you know how to interpret price action....it "tells you" (if you speak "price action", study a bit of history and add a dash of common sense)....that the odds indicate the S&P market is headed south...

 

The second chart is the daily chart from which my basic approach originates....as can be seen we have been in a months long up trend, then we went sideways as seasonal forces prepared us for the current "correction" back towards 1360...and in the next month or so we should revert back to a holiday "up" trend....into the new year....

 

Do we need COT for that...I don't think so...

5aa711669f152_Latetotheparty.thumb.PNG.1604d3e448c227d89b85b0761ce50fba.PNG

5aa71166a7235_Dailychart.thumb.PNG.dfbdc4a38cdefc519fb2401f33a2dc02.PNG

Edited by steve46

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Dear steve46,

 

Thank you for sharing us your view on the report. I would be very much interested, whether you have read through the whole thread or you have just looked at the latest couple of posts… I have tried to show many examples how to use the report and I believe that COT analysis does give you an edge in trading. Of course it is best to combine it with traditional TA and use it together with other tools for exact entries and exits. It could be used effectively as a confirmation tool in your system or it could help you find trading opportunities that otherwise you wouldn’t know of.

 

It is true that for short term traders it is not the best, because you get the report on Fridays showing you a Tuesday’s picture. But if you are a swingtrader and you are willing to hold positions for weeks or even months than I believe that you should be looking at the report.

 

You brought S&P as an example, which is surprising, because I have not mentioned it in the last post. Actually I have talked about Nasdaq in early September (post #32) where I have indicated the extreme in the market which was a bearish signal and turned out to be again a correct one. Honestly, I use COT analysis less in indexes, I believe it is more efficient in other markets (grains, currencies for example).

 

Since COT data is not derived from price, I believe it is a more solid indicator than other usual technical indicators. It really measures the stress levels in the market.

 

If you look at one of my recent calls, platinum for example, and the price reaction this week, you can see what I’m talking about…

 

Without repeating my earlier examples – hoping that you will spend some minutes to read through the first couple of posts – I would like to ask you to stick around for a few month and see for yourself how useful this tool really is. Of course if you trade only S&P and intraday, you might not find these signals useful, but I’m 100% sure that in this case you are missing some really valuable trading opportunities in other markets.

 

I’ve been trading for 12 years now and I have traded for living for over 4 years out of it. Since I have invested the majority of my trading account a year ago in a more traditional business, I cannot say that I am trading these days as heavily as I used to, but I do trade regularly and I focus my attention on the report. As I have said it before, I use other TA tools for exact entries, exits and I have my own risk and money management rules. In this thread I wish not to talk about anything other than the report and focus everyone’s attention each week on the most significant signals that the report shows us.

 

All the best,

Dunstan

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Those of us who actually trade for a living (some of us anyway), got short in the area of 1460 around the 18th Oct....my distribution shows the

resistance there and the market starts the process of rolling over....this is a seasonal move that we expect to happen at some point in October....with a potential low of 1360

 

Your very late to the party having missed little more than half the move...but then that is exactly how retail traders act...isn't it....you come in late, you get on board and then taking a beating as the market starts to correct back forth in a range....

 

While I am not trying to be critical...I do have to call it as I see it....the COT is valuable in hindsight...but the report comes public way to late to be actionable in most markets....

 

The first attached chart provides all the heads up you need if you know how to interpret price action....it "tells you" (if you speak "price action", study a bit of history and add a dash of common sense)....that the odds indicate the S&P market is headed south...

 

The second chart is the daily chart from which my basic approach originates....as can be seen we have been in a months long up trend, then we went sideways as seasonal forces prepared us for the current "correction" back towards 1360...and in the next month or so we should revert back to a holiday "up" trend....into the new year....

 

Do we need COT for that...I don't think so...

 

I'm not so sure Steve...

 

Just because it's late doesn't necessarily mean that it don't provide actionable information.... it all depends on how a person is trading.

 

I'm not sure how others folks use it, but I pretty much exclusively use it to find historical extremes in net positions held by large specs.

 

For example, the CAD has been hitting some multi year record long positions recently. So, I've been fading those long positions for the last couple of weeks, and have managed to get several triple digit ticks/pips by adjusting my targets and overall market bias based on the information that the COT provided.

 

Had the CAD not had the record net long position held by large specs... then I would not have been able to take near the profit targets that I have been, because I would have relatively fewer tools to determine if a level of resistance would hold and stall my trade out before it could target. Of course, I would have made similar entries, but my targets would have been greatly diminished.

 

But it's not just targets, knowing the imbalance of the net positions are at extremes in the CAD allows me to just trade with the wind to my back. I've never seen such an extreme net position unwind without driving a currency market several hundered pips minimum... usually upwards of 1,000 pips... So, even though the USD/CAD has moved about 300+ pips from it's september low to now... I see very strong reason to believe that we will continue to move up to at least parity, and more likley, a retest of the 2012 high.

Shorting the CAD in all forms has been the safest, easiest trade for me over the last couple weeks... and I would not be able to trade it with such consistancy if it wasn't for the COT information that supports my technical trading.

 

Anyway, I hear your point with your intraday analysis, and levels, and entering moves early, etc... but I've been in and out of the USD/CAD since 9700ish,probably taken about 50+ round turns (at least)... but i pretty much always go to bed with a short CAD position on, and I'll make sure I'm short the CAD at all times, at least until we hit parity.... and it's the COT data that helped me determine the sheer magnitude of this particular opportunity.

 

FTX

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Hi everyone,

 

The latest Commitments of Traders review is out ([ame=http://www.youtube.com/watch?v=HN2qR-Vecjo&feature=g-high-u]here[/ame]).

 

Cotton

COT Change (52W) / C-55%, LS-43%, SS-32% /

It looks like I have to mention cotton again, because of the huge change size that happened! This time we can witness a 55% size change in Commercials positions. As the review says, this last two report’s changes pushed Commercials from long 20.000 contracts to short 20.000 contracts. Of course as we know by now, these changes could affect prices in the near term, but the longer term picture is still bullish. If we look at the 10 year chart we can see what happened to prices in the past when Commercials started to decrease their net long positions and go into deep short territories.

 

Japanese Yen

COT Change (52W) / C-27%, LS-22%, SS-38% /

COT Index (3 year lb.) / C-69%, LS-39%, SS-11% /

Whenever we have witnessed such changes in C-LS-SS positions in the past, they usually ended in a COT extreme that resulted in a bottom in prices. We still got some space left for this trend to continue and really get a COT extreme picture, so prices could continue their decline.

 

Platinum

After a couple of weeks of continuous All Time signals, market participants in Platinum have moved away from their extremes. As we can see it now, it was wise to follow this market, because it turned out to be again a valid example of how affective COT analysis really is. Looking at the past similar cases, we can expect prices to continue their decline.

 

I wish all of you good luck to this week’s trading,

All the best,

Dunstan

 

the original COT report --> here

COT charts --> here

Report43_Cotton.thumb.png.1e1a1e780f3e5e748c9d15c74fc19a8b.png

Report43_JPY.thumb.png.d77069672251bb50ed592ef135a6f1f2.png

Report43_Platinum.thumb.png.b059e1b52217f5acdf8087e4a13c4829.png

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Follow the smart money / Large Speculators

 

It is important to see that in the long term, Large Speculators are the ones, who are following the trend, so it is important to have your eyes on them all the time. In the following example you should see what I mean. :)

 

Thanks for giving these chart, data. How I visit these chart directly ?.

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Hi everyone,

 

The latest Commitments of Traders review is out ([ame=http://www.youtube.com/watch?v=aPSwssMDbvM&feature=plcp]here[/ame]).

 

Cotton

COT Change (52W) / C-24%, LS-17%, SS-18% /

It looks like cotton is still on the “radar”. It is important to see the wider picture, the extreme in the market which still indicating a bullish picture. The risk/reward of such a trade could also be favorable now if you look at the chart.

 

Copper

COT Change (52W) / C-20%, LS-31%, SS-12% /

Large speculators have turned net short. Although the change signal is a bullish one, looking at all metal markets, the cot extreme that we could witness everywhere for the past couple of weeks suggest that the decline will continue.

 

Japanese Yen

COT Extreme /SS-All Time/

COT Index (3 year lb.) / C-84%, LS-24%, SS-0% /

last week’s comment: Whenever we have witnessed such changes in C-LS-SS positions in the past, they usually ended in a COT extreme that resulted in a bottom in prices. We still got some space left for this trend to continue and really get a COT extreme picture, so prices could continue their decline.

We are getting close /or in case if Small Speculators, we are already there/ the extreme that – as the past examples show- should signal a relative bottom in prices.

 

I wish all of you good luck to this week’s trading,

All the best,

Dunstan

 

the original COT report --> here

COT charts --> here

Report44_cotton.thumb.png.3c168e55a80d22202995e8a1ba4ca8bc.png

Report44_copper.thumb.png.6debea8ec487c4fbefd8df303cda6aa5.png

Report44_jpy.thumb.png.dae47929b7fa026a838456cb536e4479.png

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