Rookie39 has contacted me and was asking whether I’d be willing to contribute to this thread. I don’t know how I could fit in your Team, if at all, but let’s just give it a try. For those of you, who don’t know me, I’m running a thread called “Follow the Smart Money / COT Analysis”. The topic is the same, but I’m pretty much alone there and the thread is not getting as much attention. I don’t wish to end it though, but it may be a good idea if I started posting here as well. Of course I wish not to interrupt your thread in anyways and I am open to your suggestion concerning what I should do.
If you take look at my thread, you’ll get some understanding on what I do, how I do, so I’d rather not write it down again.
I’m currently not trading live for personal reasons, but I do analyze markets on a weekly basis. I’m usually out for the weekend, I do my cot analysis on Monday.
I analyze markets I’ve attached. Don’t get me wrong, not all of them every week, just the ones, where there is a trading opportunity.
Wilco won’t calculate itself from there on. Something is up. For the record the table ‘COT index’ next to year 2014 data , stretches all the way down it consists 4 years of data.
And moreover on max net and min net columns I get error from 3rd row and onwards notice the green wedge ?
And here’s how I did Wilco : =100*((N203-MIN(N101:N203))/(MAX(N101:N203)-MIN(N101:N203)))
I have sorted out the data, its all in order. So I don’t see any problem why Wilco won’t calculate itself ? :34:
here is the smart Rookie. I fought myself through the tutorials and Rookie organised it in 5 minutes in an email But it makes me happy as tomorrow we will see an analysis from him!
Dunstan,
it is nice to see you back here. Rookie will write you a private message and describe what we are exactly up to and what are your possibilities. I think it is better to discuss it in pm and not in 20 posts here. BTW we do our COT analysis on the weekends. Besides that we more deal with trades. You can catch up on Mondays and add your own work to the thread.
BB,
as far as not too much has changed by Dunstan, I can also answer your question about him. He uses cotbase.com as his main source and he has a subscription. This means he can use and see charts what we don’t. Until the moment he starts posting it.
As I see, FE has already answered your question. I’m not the IT type Trader, so this service comes really handy for me:)
I can post any market’s chart that you are interested in, showing full history (in some cases, dating back to early 80’s!!!), just ask me to do so.
I’ll be out for now, but see you guys on Monday. In the meantime, have a look at my previous analysis regarding New Zealand Dollar and Orange Juice (I know, VERY different markets:)). Let me post it here. Have a look at this week’s price actions too:)
[I]Orange Juice
COT Extreme / LS – 296 report COT extreme /
Don’t miss out the opportunity lying here! The bullish cot extreme is present and it is unquestionably large. As you can see on the chart, OJ has reacted nicely to cot extreme signals. I think it can be a wonderful trade.
New Zealand Dollar
COT Extreme / C – All Time, LS – 125, SS - 334 report COT extreme /
Wow, another great market with a beautiful signal! All major participants of the market hold extremely large positions and similarly to OJ, judging by the past, the market is likely going to react to the signal.[/I]
After the discussions with Philip, I told you guys that I do some historical (3 years) analysis on US Crude Oil to see how the price reacted for the COT extremes. Before I start any kind of analysis, with Philip we have assumed that Net positions and COT Index sell signals worked better than buy signals. As I have the COT Index data only for 1 year and my time is a bit limited, I make the analysis on Net Positions and I have never made a historical analysis on OI so let’s see together if it tells us something.
You can take this analysis as a warm-up for the weekend COT analysis. On the other side, BB gets a yellow card for not making any extra analysis this week! (I have to be strict here before everyone gets lazy).
As in other markets, we can observe that net positions give pretty good signals and show what is going to happen. The green lines are the buy signals, the black lines are the sell signals. The fourth sell signal is not bad but timely not accurate as there was a double top there. It is not as easy though as it looks. I write more about it in the Conclusion part.
Now this second chart is interesting to look at because we do not see such comparison very often. We will also see very soon why there are not many studies like that. I drew black lines for high OI readings and green lines for low OI readings. Well I could draw a lot more lines because OI was ranging quite a lot with many similar bottoms or tops. Two lines are completely off the track, I marked them with a red signals. We might most say that an extreme OI signal had an extreme reading but we can not conclude if an extreme low OI means very high or low price as it is changing. I marked some high OI readings on the chart which occurred more on market tops but in the beginning of the chart I could have drawn many lines when a high OI would have not meant high prices. You guys can look for patters, that is why the chart is there but it does not help me much.
Conclusion: I find Crude Oil until this point the most challenging market to make decisions based on historical COT analysis. Although the Net Positions signals are accurate but look at the shift of extremes continuously. Both high and low extremes are trending down which makes it hard to spot them live. According to the last years, we are having currently buy signals since many weeks but price keeps falling. If we look at the all time extremes then we are not at a signal at all. The very different extreme does give us a tough time to decide when the market turns.
Regarding the OI chart, it does not help us much and we should make more historical analysis based on OI readings with comparing to price action. If other markets are just as useless as US Crude Oil then we can find great fundamental reasons for high and low OI but the practice shows this indicator is useless when we try to use it. The only one assumption I can make about is that high OI means mostly high prices so a fall has a higher probability than an increase. But even for this statement there are many exceptions on my charts.
Hopefully you enjoyed my weekly study,
FE
PS: look at the gold and silver charts guys. They made some nice progress in the last hours, we will see if it will be faded or they hold up (or extend) their gains.
I actually making a historical analysis but I’m involving COT Index with 3 different look-back settings (3 years, 1,5 years, 6 months). It takes some time but it will arrive soon.
Nice analysis btw It is always interesting to see Commercials and Funds in action.
That was Tuesday night, it seems there was some gathering.
So if there was gathering on Gold, then like the song that I sang earlier ‘you can’t have one without the other’
Check out Gold and Silver this week. Maybe also check $SLV and it’s volume today.
Then take it one step further, check out the USDX today.
My post on Tue night re Gold was also part of the reason I didn’t short Eur/Usd yesterday, even though it seemed to be the thing to do. Sure there’s talk of short squeezing and so on, but Gold was the thing to watch - all from a little ETF.
That’s the power of Intermarket Analysis
Edit: it was Wed night, starting to mix up the days of the week, not a good sign.
before doing the COT report, I wanted to share the two things I learnt this week:
When Peter said that retailers make their fast decisions in the first hour of the stock market based on news. Thinking about it, I think in the very beginning I was doing the same.
I did not finish the thought process of the first point because it is in correlation with the second wisdom! I copy a sentence from the Murphy book. Keep it always in mind: “Try to ignore conventional wisdom; don’t take anything said in the financial media too seriously.” What Peter was saying that the bad news are already priced in the time it gets to the public. What Murphy says is that you should anyway not pay much attention on the financial news anyway.
[B]Conclusion[/B]: do your COT analysis, learn Peter’s intermarket relations, don’t believe everything you read and you’ll be just fine
Comms had +2990 pips against Majors.
And that will make it [B]4[/B] in a row for the Comms. (man was I wrong last week calling for the Majors)
Does anyone want to put an explanation to it?
(my take)
GBP meeting dropped them big time. They were showing strength for a couple weeks, until Wed. when the floor gave way.
JPY still on a downward spiral.
USD over bought (I guess).
NZD, AUD have the carry trade? So much for the talking down from their central banks. Money runs to the Comms. Also AUD is still on their way back from the big correction. Probably has more running room still.
you asked Doc but hopefully I am allowed to answer.
The results are clear the interpretation is not so clear. I do not say what you wrote is not true because you said actually with words what the numbers say.
I would rather say though that “comdolls did not win but mayors lost”. This is an important difference. I do not see special strength to comdolls but a large weakness from the majors. You said GBP and JPY were the decisive currencies. This is very true. If you add to it that EUR is always basically weak and CHF is expected to make some stimulus as we also reached the 1.20 EUR/CHF peg, you can see that USD is the only one to be fighting out there. (I talk about the long-term here, not that particular week).
Something we have seen this year how important risk off sentiment for the comdolls and JPY is. This means I am long with comdolls since a while but I have SL everywhere. I always give room to my trades because I do not like to be whipsawed and I actually like the visual SL but with comdolls I pay attention because one unexpected geopolitical risk can erase all the winnings. So I use here a SL which Peter defined something like a “dumb day SL” or soemthing like that, in case I am not sitting at the computer I still have something on the chart to save me from a complete collapse.
I hope this answers for part of your questions. And keep us coming your colored excel sheets.
I have been on with BBs sheet since early evening. Have you gotten yourself a copy of his database ? Yes he’s giving it away :59: We don’t have to sweat about it anymore. I have just been copying and pasting. Its really been a walk in the park. The only problem is though as I’m still new to this way of doing analysis, I think the wordy parts are going to be sluggish this time around. But I’ll work on it :-))
BTW, if anybody else needs a copy, pm me 
But it makes me happy as tomorrow we will see an analysis from him!
