COT Report Analysis - a thread on market sentiment

Morning everyone,

how about shorting Nikkei and DAX? Check guys the daily TF on this two with the RSI. There is a divergence which says there should be a reversal. I am thinking about to wait for a retracement and then jump in to the down side. Any thoughts?

Peter, if this is the case then I guess it is logical to say that S&P high should come also later. What do you think?

FE

Hi Peter,

I hope you took some profits. It seems like you will get now the dip to buy.

FE

Took profits on Eur/Usd, back in again on Mon/Tue - not yet building here, will probably start that soon, it’s just that USD shorts are still jittery so the temptation is to take the profits.

See the price fall today at New York Open - that’s the jitters - but they will slowly dissipate - have to keep an eye on the Greece thing.

The S&P long is avg 2065 so no exit there, just more of same, building on this one for the new high, when it comes the position should be reasonable, well that’s the plan.

Where do you have SL for the S&P trade? At BE or do you let it to go into negative territory too?

Don’t actually have one set yet, I know, I know, but it’s just the way it happened, I will set a single SL soon.

The momentum triggered by EZ QE was enough to pull investors along in the S&P, but this past couple of days, with some profit taking in Europe, I will be forced to set a b/e SL. If b/e happens then the whole process will start over.

Cannot see any meaningful prospect of building something on the short side on S&P.

Mornin’ guys!

I just finished updating my database, so here are the results.

Before I forget, I know I did not post last week’s numbers. That was because BabyPips was unavailable during the whole weekend.

[B]Wheat[/B]
I’ve been waiting for the signal for quite a while now. I know the trade is counter-trend, but since Grains (especially Wheat and Corn) are sensitive to Commercial/Fund extremes, I’ll probably take the opportunity. (6%)

[B]T-Bonds[/B]
We are almost at an extreme. I’m watching the instrument, although because of the strong uptrend, I’ll most likely skip the short. (85%)

[B]VIX Index[/B]
We are approaching the oversold area. VIX responds pretty well to COT extremes, so it’s a good idea to pay attention. (25%)

[I]By the way, I don’t see your reports.[/I]

Well I do the COT report the classic way Larry Williams does. The only thing I can report on is that EURUSD COT Index is at an extreme, so we should get ready to buy. Or at least ignore selling the EUR for now.

Philip, you are sounding a little like a voice in the wilderness :slight_smile:

I’m only joking, but the truth is that even the cot can be lagging, I suppose, the bottom line is that FE’s last four words in his thread title is the only thing that leads.

Speaking of which, many of the current black boxes are trying to harness this very aspect.

A sort of an update to the above.

There is a good chance that some guys will be setting levels on Eur/Usd on the upcoming week.

These numbers they may quote are meaningless, new week, new outlook, gas from Russia, who cares, Tuesday is where to set your orders.

Hi Guys,

DAX opened with an up gap, sustained it and moved forward. Short after my system gave a buy signal. I am in with a SL and good R:R. We will see. Share your opinion and I wish everyone a nice week.

Interesting discussion between Peter and Philip. I agree with Philip says, but not ready to buy. Many EUR charts do not confirm just yet for me to buy EUR, but like Philip says, I also do not want to sell it.

FE

Long again on Eur/Usd - at this morning’s mid Asian and yesterday’s London’s low (1.0717) - so Asian Traders, please protect that level tonight.

Still waiting on the new S&P high - patience they tell me is a virtue.

FE, looks like the Dax has found some buyers - see what it did when it found it’s new high, new high brought lots of new buys, those who had been building sold to them, wonder now will those same guys start re-building - who knows.

Hi Peter,

I got out twice just above BE. It is very choppy, for me there is no clear trend. I want to protect my capital so I take here little risk. It is of course also a disadvantage but still.

BTW I was thinking a lot on you today when I was watching the indeces. I thought: “Peter has a good day at least”. The last hours weren´t that good for you but you can´t complain! My DAX choice was not the right one, S&P would have been better. However if we are honost, Nikkei took the gold medal :slight_smile:

Good night,
FE

Hi FE,

Yep, the Nikkei was not hesitant it looking for it’s new high, a simple trade of just buy and hold without any additions I suppose would have been the way.

I see the Asian Traders defended me to the pip on Eur/Usd, now the big question is what are the Europeans going to do, I’ll just have to wait and see…

Update:
The best the London traders managed was to take the trade to +80 pips, since I’m trying to get onto the Euro I did not exit, I have a specific level to watch so it means I can now set a close SL, will watch to see if NY buys at 1.0720

And final update at London close.

See how my entry level was ‘defended’ all day, this is probably bad news for my plan to get a reasonable position going, that level will become more attractive for any stop hunting that may happen, now I have to widen the SL to equal the last long scalp which will take me out at 1.0647 - it’s not easy position building at transition time, and it sure takes patience.

On the S&P , still just waiting for the new high… then exit.

Hi Peter,

as we always talking about following the trends, don´t you think it would be a lot easier and less stress to wait until the transition is over and just join when the trend is established?

I wish you good trade with S&P, you have great patience in these tough times.

FE

Hi FE,

Yeah, two trades, one is following the trend - i.e. S&P long, near time for the new high now.

The Eur/Usd - I chose to chronicle that one because I could see how it was going to play out using the session levels, the trade is currently plus 100 pips so will take same profit and now move SL to B/E.

I mentioned the tight SL because I know that many guys would do that, mm’s know it too, that’s why I also mentioned anticipating a run and widening the SL to at least a previous win level - that way a person is still using the market’s money.

When all that is played out then it’s time for b/e and profits.

Must say it all played out almost as if I’d scripted it :slight_smile:

Great news Peter,

congratulations on your great analysis. I am also in index, today the long side but chose the Nikkei to go with. My entry was quite ok but there is not movement since many hours.

I guess you do not trade tomorrow so I wish you a happy weekend,

FE

Exited Eur/Usd at London open this morning - at the round number - end of week, session opening and round number usually mean profits taken, next week new times, new outlook - Greece still holding the key on Euro, no new news will mean creep up, good news will mean jump up and bad news will mean cliff fall.

The thread is quiet, but one final little note on Euro - I was trading the anticipation of a deal on Greece, I’m happy to have exited, that anticipation has considerably lowered this evening in Riga.

The Greek PM will talk thing up over the weekend, Ms Merkel may also put a positive spin, but reality is things may go to the wire - markets dislike uncertainty so I’ll not jump into any Euro trade on Monday.

Hi Peter,

I do not know what you feel about this situation but I am quite fed up with it. I rather see any kind of decision there than this postponing of the decision the whole time. They should stay and do the work or byebye.

What is your thinking on stocks for next week?

FE