Follow the Smart Money / COT Analysis

Discussion in 'Trading' started by Dunstan, Jul 11, 2012.

  1. Dunstan

    Dunstan

    Hi everyone,

    The latest Commitments of Traders review is out.

    Sugar
    COT Change (52W) / C – 34%, LS - 26%, SS - 45% /
    The large change in Trader’s positions suggest that prices will drop. Of course we never should forget to look at the bigger picture. If we open a longer chart, we can find that not long ago we were in a very bearish looking cot extreme situation (commercials net long). Traders are moving away from these extreme territories, and as they do, prices are rallying.

    Cocoa
    COT Extreme / All-Time COT extreme levels in C and LS /
    Last week’s comment is still alive: prices should reach a top soon.

    5-Year Note
    COT Extreme / C-408 report, LS – 293 report, SS – 411 report COT extreme /
    Judging by last week’s price reaction, we may have reached the bottom.

    I wish all of you good luck to this week’s trading,
    All the best,
    Dunstan

    the original COT report

    COT charts

    Commitments of Traders basics
     
    #211     Sep 16, 2013
  2. Dunstan

    Dunstan

    Hi everyone,

    The latest Commitments of Traders review is out.

    S&P-500
    COT Change (52W) / C – 44%, LS - 36%, SS - 26% /
    The large change in Trader’s positions may shake prices a bit (we could see declining prices), but in the medium/long term, I don’t see, why prices could not rally further. Since the last major cot extreme, prices are again going higher/stress levels are decreasing. I may be wrong, but I would expect a larger, close to All-Time cot extreme to signal the top.

    British Pound
    COT Change (52W) / C – 24%, LS - 28%, SS - 11% /
    The cot change and the relative extreme in the market may put an end to the rally. The fact that only Small Speculators are optimistic about the rally is also a bearish signal. Of course one may argue: stress levels in British Pound are not at their peak levels yet, thus prices can rally further… well, as always, I urge everyone to look not only at the cot data, but use it together with other TA tools. Simply looking at a longer chart, it is clearly visible, that prices are not far from important resistance levels.

    Corn
    COT Extreme / C-448 report, LS – 449 report COT extreme /
    If we look at a longer chart, we can see that all obvious bottoms in prices correlated with major cot extremes, when commercials were net long. This is the situation right now.

    I wish all of you good luck to this week’s trading,
    All the best,
    Dunstan

    the original COT report

    COT charts

    Commitments of Traders basics
     
    #212     Sep 23, 2013
  3. Dunstan

    Dunstan

    Hi everyone,

    The latest Commitments of Traders review is out.

    Dow Jones-30
    COT Change (52W) / C – 42%, LS - 29%, SS - 54% /
    COT Extreme / C-553 report, LS – All Time COT extreme /
    The huge change in Trader’s positions and the All Time cot extreme both are very strong bearish signals… the rally be over for some time now.

    USD Index
    COT Change (52W) / C – 28%, LS - 26%, SS - 18% /
    If we analyze the past one year of the USD Index, we can find that it reacted pretty well to cot change signals. In the latest report we can find a larger that average change, which can be considered a bullish signal.

    Cocoa
    COT Extreme / C, LS – All Time COT extreme /
    Stress levels are high, we are expecting prices to reach a top soon.

    I wish all of you good luck to this week’s trading,
    All the best,
    Dunstan

    the original COT report

    COT charts

    Commitments of Traders basics
     
    #213     Oct 1, 2013
  4. Dunstan

    Dunstan

    Hi everyone,

    It seems that the U.S. Shutdown has an effect on us, people who follow the cot reports. The CFTC has stopped issuing the reports for now. Let’s hope that this situation will not last very long!

    All the best,
    Dunstan
     
    #214     Oct 7, 2013
  5. Dunstan

    Dunstan

    Hi everyone,

    CFTC has resumed publishing the cot reports, they are up-to-date again! 

    The latest Commitments of Traders review is out.

    Soybean Meal
    COT Change (52W) / C – 31%, LS - 36%, SS - 18% /
    If we look at the last one year, we can find that similar large changes in Trader’s positions preceded the rallies. Although we don’t have a large extreme in the cot report, the recurring patterns seem to be convincing.

    Nasdaq-100
    COT Extreme / LS – All Time COT extreme /
    There is an unquestionable bull market here… even if we’ve got an All Time cot extreme that is indicating a top, we should be very careful entering against the obvious trend. Of course the Risk/Reward on such a trade could be pretty tempting

    Cocoa
    COT Extreme / C, LS – All Time COT extreme /
    The large cot extreme in Cocoa has been present for many weeks now, but without any real price reaction. Still, I think there is great opportunity here, so we shouldn’t forget about this market!

    I wish all of you good luck to this week’s trading,
    All the best,
    Dunstan

    the original COT report

    COT charts

    Commitments of Traders basics
     
    #215     Nov 12, 2013
  6. Dunstan

    Dunstan

    Hi everyone,

    (Sorry for my late update… I took a little holiday :), just came back yesterday)

    The latest Commitments of Traders review is out.

    Copper
    COT Change (52W) / C – 25%, LS - 30% /
    COT Extreme / LS – All Time COT extreme /
    The very large change in Trader’s positions and the unquestionable extreme in the market both suggest prices should go higher. This, together with close support levels adds up to an exciting trading opportunity that should be investigated more closely.

    Japanese Yen
    COT Change (52W) / C – 25%, LS - 38% /
    COT Extreme / C – 334 report, LS – 331 report COT extreme /
    The even greater change last week could not affect prices positively, so I’m not expecting the recent changes to do any better… the extreme has been present for almost a year now, but the down trend is obviously intact. Trading this market to the upside looks pretty risky, even though we’ve got large stresses built up in it.

    Cotton
    COT Extreme / C – 52 report, LS – 50 report COT extreme /
    Commercials have again become net long, only small speculators are holding short contracts… If we investigate the historical charts, we can see that usually prices bottomed out, when we had a similar case. The volume and open interest scores also support the bullish bias that we have.

    I wish all of you good luck to this week’s trading,
    All the best,
    Dunstan

    the original COT report

    COT charts

    Commitments of Traders basics
     
    #216     Nov 27, 2013
  7. Dunstan

    Dunstan

    Hi everyone,

    The latest Commitments of Traders review is out.

    5-Year Note
    COT Change (52W) / C – 22%, LS - 22%, SS – 19% /
    Looking at a longer chart, we can see how the recent cot extreme managed to push prices higher. The bearish signal coming from the latest report (large changes in Traders positions) suggests that we could see a bit of a decline in prices, but let’s not forget the strength of a cot extreme signal --> until we reach an opposite cot extreme (Large Specs above 300.000 contracts for example), I believe the last extreme is still in place.

    Japanese Yen
    COT Extreme / C – 335 report, LS – 332 report COT extreme /
    I hope everyone took my advice last week and stepped away from this market :) As we can see, even though we’ve got this close to all time cot extreme in the market, prices don’t seem to bother… I believe (but it’s really just my feeling) that we will stress levels in Japanese yen rise even further.

    Wheat
    COT Extreme / C – 20 report, LS – 79 report COT extreme /
    Analyzing the historical chart, we can see how well wheat reacts to cot signals. This time, we’ve got a bullish type cot extreme in the market that’s telling us: prices should start climbing soon.

    I wish all of you good luck to this week’s trading,
    All the best,
    Dunstan

    the original COT report

    COT charts

    Commitments of Traders basics
     
    #217     Dec 3, 2013
  8. Dunstan

    Dunstan

    Hi everyone,

    The latest Commitments of Traders review is out.

    Dow Jones-30
    COT Change (52W) / C – 27%, LS - 24%, SS – 22% /
    Without the large cot extreme, this change in Trade’s positions is not enough for me to really seriously consider a larger short trade… I’m not convinced.

    Japanese Yen
    COT Extreme / C – 336 report, LS – 335 report COT extreme /
    The picture still seems to me more bearish than bullish, even if we’ve got this enormous (but still not All Time!!) cot extreme. I do believe that we can see further increase of the stress level present in this market, maybe even to all time levels, before prices reach a bottom.

    Rough Rice
    COT Extreme / C – 22 report, LS – 108 report COT extreme /
    Interesting to see, how different the picture is on a longer chart that on a shorter one… If we look from high above, we see more of a bullish type cot extreme, but as we narrow down our perspective, we can see the relative extremes that were pushing prices back down.

    I wish all of you good luck to this week’s trading,
    All the best,
    Dunstan

    the original COT report

    COT charts

    Commitments of Traders basics
     
    #218     Dec 9, 2013
  9. Dunstan

    Dunstan

    Hi everyone,

    The latest Commitments of Traders review is out.

    Copper
    COT Change (52W) / C – 22%, LS - 28% /
    We’ve got our two major cot analysis tools pointing the opposite way this week: the change in Trader’s positions was large, suggesting prices should decline, but the last great cot extreme in the market that started the recent rally is still in place. Of course “worry we should not” (Yoda:)), cause their timing is different… even if we experience a bit of a decline now (which judging by the effectiveness of cot change signals in copper, I expect), the wider picture seems to support the continuation of the rally.

    Sugar
    COT Change (52W) / C – 22%, LS - 28% /
    COT Index (3yr lookback) / C – 63%, LS - 43%, SS – 29% /
    It’s wonderful to see, how the recent bearish cot extreme ended signaled the recent top and how Traders have moved away from their extremes as prices decline. The change suggests prices could have a “bit of a break” in the decline, but since we are not that close to a bullish cot extreme (would be the case if C reached >20.000 contracts net long / LS reached <10.000 contracts net short), I expected prices to continue the decline.

    Cocoa
    COT Extreme / LS – All Time COT extreme /
    The very large stress that has built up in Cocoa market indicates that the fuel in this recent rally is running out…

    I wish all of you good luck to this week’s trading,
    All the best,
    Dunstan

    the original COT report

    COT charts

    Commitments of Traders basics
     
    #219     Dec 16, 2013
  10. Dunstan

    Dunstan

    Hi everyone,

    The latest Commitments of Traders review is out.

    Coffee
    COT Change (52W) / C &#8211; 27%, LS - 23% /
    The large cot extreme that we had in early November signaled well the bottom in coffee&#8230; now we have this large change in Trader&#8217;s positions, which I believe will push prices down a bit.

    Copper
    COT Change (52W) / C &#8211; 23%, LS - 31% /
    Again another large change after last week&#8230; if this dynamic selling of commercials continues in the next few weeks, we will reach a bearish cot extreme pretty fast. Of course &#8216;IF&#8217; as I said&#8230;

    Cocoa
    COT Extreme / LS &#8211; All Time COT extreme /
    When will the bubble burst? That&#8217;s the big question here&#8230; let&#8217;s keep our eyes on this market, there&#8217;s a great potential on the bearish side now.

    I wish all of you MERRY CHRISTMAS!!!
    All the best,
    Dunstan

    the original COT report

    COT charts

    Commitments of Traders basics
     
    #220     Dec 23, 2013