Jump to content

Welcome to the new Traders Laboratory! Please bear with us as we finish the migration over the next few days. If you find any issues, want to leave feedback, get in touch with us, or offer suggestions please post to the Support forum here.

  • Welcome Guests

    Welcome. You are currently viewing the forum as a guest which does not give you access to all the great features at Traders Laboratory such as interacting with members, access to all forums, downloading attachments, and eligibility to win free giveaways. Registration is fast, simple and absolutely free. Create a FREE Traders Laboratory account here.

Dunstan

Follow the Smart Money / COT Analysis

Recommended Posts

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

Share this post


Link to post
Share on other sites

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.

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites
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

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites
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 ?.

Share this post


Link to post
Share on other sites

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

Share this post


Link to post
Share on other sites

Join the conversation

You can post now and register later. If you have an account, sign in now to post with your account.
Note: Your post will require moderator approval before it will be visible.

Guest
Reply to this topic...

×   Pasted as rich text.   Paste as plain text instead

  Only 75 emoji are allowed.

×   Your link has been automatically embedded.   Display as a link instead

×   Your previous content has been restored.   Clear editor

×   You cannot paste images directly. Upload or insert images from URL.


  • Topics

  • Posts

    • Date : 14th October 2019. MACRO EVENTS & NEWS OF 14th October 2019.No-deal Brexit risks are looking more real than ever, with reports suggesting that talks will officially break down this week ahead of the upcoming EU summit on 17 and 18 October. Elsewhere, further US data and Fedspeak could provide more clues about the possibility of a Fed rate cut. Tuesday – 15 October 2019 Consumer Price Index (CNY, GMT 01:30) – September’s Chinese CPI is seen unchanged at 0.7% while the PPI figure is expected to decline further to -1.2%. The overall reading for CPI is estimated to post a gain up to 2.9% y/y. ILO & Average Earnings Index 3m/y (GBP, GMT 08:30) – UK Earnings with the bonus-excluded figure are expected to slip to 3.7% y/y in the three months to August, down from 3.8%y/y. UK ILO unemployment is expected steady at 3.8%, which was the lowest rate seen since December 1974. ZEW Economic Sentiment (EUR, GMT 09:00) – Economic Sentiment for October is projected at -27 from the -22.5 seen last month, as the current conditions indicator for Germany turned negative. The overall Eurozone reading though expected to declne further to -33.0 slightly from -22.4. A lower than expected outcome, ties in with the stagnation in market sentiment at the start of the month. Consumer Price Index (NZD, GMT 21:45) – One of the most important figures for FX markets, the y/y CPI for Q3 is expected to come out at 1.4%, compared to 1.7% in the previous quarter. Wednesday – 16 October 2019 Consumer Price Index (GBP, GMT 08:30) – The UK CPI is expected to rebound to a 1.8% y/y rate in September after dipping to 1.7% in August from 2.1% in July. Weakness in sterling from year-go levels should impact some offset to disinflationary forces. Consumer Price Index (EUR, GMT 09:00) – The Euro Area CPI is expected to be confirmed at just 0.9% y/y in the final release for September, although the deceleration in the headline rate over the month was largely due to base effects from energy prices, with core inflation actually moving up to 1.0% y/y from 0.9% y/y in August. Consumer Price Index (CAD, GMT 12:30) – The Canadian CPI index is expected to have increased to 2%y/y compared to 1.9%y/y in August. The core CPI measures remained near 2.0%. Retail Sales (USD, GMT 12:30) – Retail Sales are an important determinant of consumer spending thus making it a leading indicator for overall economic growth. Consensus expectations suggest that we should have increased by 0.2% in September, for both the retail sales headline and the ex-auto figure, following a 0.4% August headline rise with a flat ex-auto figure. Fedspeak: Fed Brainard (USD, GMT 19:00) Thursday – 17 October 2019 European Council Summit on Brexit Employment Data (AUD, GMT 01:30) – While the Unemployment Rate is projected to have flipped at 5.3% in September, Employment change is expected to have eased, increasing by 10K compared to 34.7K last month. Retail Sales ex Fuel (GBP, GMT 08:30) – Retail Sales in the UK are anticipated to increase in September, reaching 3.0% on a y/y basis, and 0.5% on a m/m basis, from the 2.7% and -0.2% respectively Housing Data and Building Permits (USD, GMT 12:30) – Housing starts should drop back to a 1.282 mln pace in September, after a sharp rise to a 1.364 mln clip in August with the help of lower mortgage rates. Permits similarly are expected to slow to 1.370 mln in September, after popping to 1.425 mln in September. Permits have shown a solid growth path into Q3 despite a July starts set-back. Philadelphia Fed Manufacturing Survey (USD, GMT 12:30) – The Philly Fed index is seen falling to 7.0 from 12.0 in September, versus a 1-year high of 21.8 in July and a 33-month low of -4.1 in February. The late-September producer sentiment surveys deteriorated significantly after firmness in the early-September reports, and the early-October data will be closely scrutinized to see if this pull-back continued. The “soft data” surveys are at risk of a possible impact from the UAW-GM strike, alongside the ongoing headwind from troubles abroad. Fedspeak: Fed Bowman and Fed Williams (USD, GMT 18:00 and 20:20) Friday – 18 October 2019 European Council Summit on Brexit China Gross Domestic Product (CNY, GMT 02:00)- Chinese GDP is projected to see additional moderation to a 6.1% y/y pace in Q3, from 6.2% in Q2. Industrial Production and Retail Sales (CNY, GMT 02:00) – The September industrial production is forecast at 4.5% y/y from 4.4% previously, while September retail sales likely improved to 7.7% y/y from 7.5%. Fedspeak: Fed Kaplan and Fed Clarida (USD, GMT 15:00 and 15:30) Always trade with strict risk management. Your capital is the single most important aspect of your trading business. Please note that times displayed based on local time zone and are from time of writing this report. Click HERE to access the full HotForex Economic calendar. Want to learn to trade and analyse the markets? Join our webinars and get analysis and trading ideas combined with better understanding on how markets work. Click HERE to register for FREE! Click HERE to READ more Market news. Andria Pichidi Market Analyst HotForex Disclaimer: This material is provided as a general marketing communication for information purposes only and does not constitute an independent investment research. Nothing in this communication contains, or should be considered as containing, an investment advice or an investment recommendation or a solicitation for the purpose of buying or selling of any financial instrument. All information provided is gathered from reputable sources and any information containing an indication of past performance is not a guarantee or reliable indicator of future performance. Users acknowledge that any investment in FX and CFDs products is characterized by a certain degree of uncertainty and that any investment of this nature involves a high level of risk for which the users are solely responsible and liable. We assume no liability for any loss arising from any investment made based on the information provided in this communication. This communication must not be reproduced or further distributed without our prior written permission.
    • This should really be very easy, but I can't find an article or video to walk me through it. I picked 20 ticker symbols where the stocks are in a tight trading range. I got them all into one list I call "Channel". I'd like to add several indicators that apply to all, such as MACD, volume, 3 moving averages. Then I'd like to scroll through the list, adding trendlines, or horizontal lines to mark the top & bottom of the price channel for each. Then set an alarm for a breakout in each direction that indicates a breakout. Could you point me to an article or video that walks me through how to do this? ...or give me the steps? Thank you, RichardV2, Experienced stock trader back before the Internet was invented.😁
    • The Economic Proscription of U.S. Farmers by China Maybe Forever   Similar to a black eye on the face, it’s placing an indelible imprint. The retaliatory levies by China over U.S. commodity producers, such as soybeans, which seem to be forever. The moment such happens for the market it becomes irreversible.   It’s a dread numerous farmers from North Dakota to Mississippi have recognized for as far back as last year. They worry that they’ve put millions in soybean development on account of China. Since Chinese focus is now transferred towards Brazil rather, that market might be gone forever.   Once the confidence merchants have in the U.S. declines as a steady provider because of the trade dispute, the more vital its important for them to support and further broaden other avenues.   The developing danger for American agribusiness presently is that a great part of the piece of the overall industry lost throughout the year will be hard or difficult to win back at any point shortly, the Boston Consulting Group said in a detailed analysis discharged on Wednesday.   This is for the most part because of long term contracts that are regularly recorded among purchasers and sellers, contingent upon the item. The lesson from the analysis shows that U.S. farmers need to turn out to be less reliant on China, and simply trust in the best concerning those customers organizing a rebound sooner or later.   For the time being, China is going to Australia, Brazil, New Zealand, Russia, and also for its domestic producers as an option in contrast to American developed crops and animal proteins.   From the detailed analysis: “The risk that U.S. agribusinesses may for all time lose foreign market share of the overall industry isn’t only hypothetical. In past trade disputes, for example, one with China including beef, the US has not recaptured its lost share. As a result of the increase of U.S. crops and food materials more costly than other choices, high duties bring down the price to merchants who plan to expand. Also, the fewer confidence merchants have in the US as a steady provider, in perspective on the potential for future trade disputes, the more important it progresses toward becoming for them to support and further expand. After some time, merchants could loosen up complex associations with suppliers from the U.S.”   China Receives Blames for the Pressure And this is so because China is important to American farmers. China purchased $19.5 billion in U.S. agricultural items as of 2017, representing 14% of exports of farm produce, in light of BCS analysis. In July 2018, China slammed a 25% levy on U.S. agricultural items.   Exports at that point declined by an incredible 53% for the year. While exports to China have declined also for this year, over past years free fall.   There is another motivation behind why some China customers may not come back to the U.S. China is extending its very own crop acreage, particularly for soybeans. After some time, China will turn out to be progressively independent. Except if request increases generously, China will purchase its very own soybeans, regulating export development and under control in any case.   “Individuals in the business were in a condition of cheerfulness, believing that a bargain would soon be reached,” says Michael McAdoo, associate, and related executive for BCS in Montreal. “Our analysis demonstrates that regardless of whether there is a bargain, there is worry that a similar volume won’t return. They need to try different markets,” he declared.   Source: https://learn2.trade 
    • Trade Dispute Responsible for China’s Overwhelming Gold Purchase Rate   China has included more than 100 tons of gold to its stores since it continued purchasing in December, fortifying its position as one of the significant authority collectors as national banks load up on the valuable metal.   The People’s Bank of China grabbed progressively gold a month ago, raising reserves to 62.64 million ounces in September from 62.45 million in August, as per information on its site. In tonnage terms, the most recent inflow sums 5.9 tons and comes in as an expansion of about 99.8 tons over the earlier nine months.   Bullion hit the most noteworthy in over six years in September as more slow development, the trade dispute and rate reductions prodded financial specialist request. National banks have been significant purchasers as well, particularly in developing markets. Administrative demands will probably proceed as protectionist strategies and geopolitical concerns add to the request, as forecasted by Suki Cooper, the valuable metals investigator at Standard Chartered Bank.   “With the stressed partnerships with the U.S., China requires support against its enormous possessions of the dollar, and gold serves that capacity,” said Howie Lee, a financial specialist at Singapore-based Oversea-Chinese Banking Corp. “As China turns into a superpower in its very own right, I anticipate progressively gold-purchases.”   China’s High Gold Appetite The PBOC’s continuos running of bullion-purchasing has come against the difficult setting of the trade dispute with the U.S. furthermore, a stamped lull in development at home. While high-level discussions are set to continue in Washington this week, Chinese authorities are flagging they’re progressively hesitant to consent to an expansive bargain.   Spot gold spiked to as much as 0.4% to $1,511.31 an ounce on Monday and exchanged at $1,505.84 in early London exchange. While the value declined 3.2% in September, they remain high at 17% this year. The PBOC information was discharged at the end of the week. Alongside China, Russia has additionally been including generous amounts of bullion. In the initial half-year, national banks overall got 374.1 tons, supporting the overall gold request to a three-year high, the World Gold Council declared.   While a tenth straight month of amassing, shows an unfaltering purchasing trend for the PBOC, China has in the past gone for significant stretches without uncovering moves for its gold possessions. At the point the national bank declared a 57% bounce in savings to 53.3 million ounces in mid-2015, that was the first update in quite a while.   Source: https://learn2.trade   
    • GBPJPY Reverses Its Sell-Off Around the Level at 130.75  OCTOBER 9, 2019  Azeez Mustapha  No Comments   GBPJPY Price Analysis – October 9 In the prior session, the pair closed lower for the second day in a row, but currently, the GBPJPY displays a weakness further downside of the pair while retaining its wider medium-term outlook by temporal reversal on the level at 130.75.   Key Levels Resistance Levels: 148.66, 137.80, 135.774 Support Levels: 130.75, 128.68, 126.54   GBPJPY Long term Trend: Bearish In the bigger picture, the GBPJPY consolidation structure is still forming from the technical support zone on the level at 126.54 low.   A further upward move may be recorded towards the level at 146.57 and 148.66 in an extension where its resistance is glaring before completing the structure. However, the overall trend remains bearish while displaying an intact downtrend in the medium and long-term.   GBPJPY Short term Trend: Bearish On the 4-hour time frame, its price is trading narrowly between the moving average 5 and 13 close to the key technical support level at 130.44.   As it is presently, the intraday bias in GBPJPY remains on the downside at this point where a corrective rebound from the level at 126.54 low should have completed. Meanwhile, its 4-hour RSI is bearish and pointing lower suggesting further weakness.   Source: https://learn2.trade 
×
×
  • Create New...

Important Information

By using this site, you agree to our Terms of Use.