Ok guys, here is a study how timely net positions can tell us the action on the USDRUB pair in the last three years.
Take a look:
Conclusion: as you can see the results are pretty amazing. The black lines represent all the COT Commercial buy signals and the green lines represent all the COT Commercial sell signals. Actually there were 2 signals completely off: the 3rd black line from the left (the place was a perfect entry actually but as there is a huge and sudden downward movement it would have hit the SL for sure) and the 3rd green line from the left. All other signals are good and more than that: timely accurate! We read often that COT is not a timing tool however here it was. The price reaction to the extreme reading came always short after the extreme position. This might be such a great indicator in this pair because as we know the ratio of commercial players is a lot higher than in the case of most of the other pairs. Commercials almost have all short and long open interest so looking at their signal seems to be perfect for timing. If we put a tight SL on the opposite side of our trade we could have had very limited loss for the 2 fakeouts mentioned and make some huge gains.
Important: comparing the sell and buy signal the commercial net position chart shows us better buy signals.
As I highlighted how important this pair is to watch (because of extreme level and high carry trade to the short side) I hope I could give you some interesting information about it.