S&P-500
COT Change (52W) / C – 32%, LS –38% /
The cot change IS large (bullish cot signal) and we have no bearish cot extreme, on the contrary, in some of the indexes, we are seeing more of a bullish extreme! Conclusion: although cot analysis may not be the most effective in indexes, analyzing the report, I think the rally is not over.
Japanese Yen
COT Change (52W) / C – 18%, LS – 12%, SS – 35% /
The 18% in Commercials and the 12% in Large Specs (changes) wouldn’t be in my opinion something to talk about, but the 35% in Small Specs is a significant change. It is of course a bearish cot signal, so I’m expecting a bit of a decline in the near term. The cot data on the wider time horizon says that prices can continue their rise, at least the last major cot extreme signal was bullish (at the end of last year). It is still in place, until prices go below the last bottom, which would result in a widening cot extreme.
Platinum
COT Extreme / C – 64, LS - 64 report COT extreme /
The bearish extreme is widening, while prices are rallying. I think there is still some time left, before we reach the next top, and it would be nice to see small speculators reaching an extreme also (above 6000 contracts net long).
I’ve never seen COT data used to compare a 52week change…that’s interesting.
It just seems like over that time period, positions will change frequently the net result wouldn’t be much use.
Emini com. speculators are net short as of last TUE almost 1.5:1. 44k less long, 51k more short.
I would never use the cot report as a primary source of analysis to make a trading decision, but if I were, I think I’d prefer to focus on the short-med term changes.
52week change: the single change is Traders positions on a given report is measured to the 52-week (1 year) range of the net positions max and min levels. More precisely, please read post#3.
Using cot analysis as a primary tool for trading: As I have stated many times in the thread, cot analysis on it’s own is less than enough to take a trade. But I do believe that is a crutial tool that helps you indentify trading opportunities or in justifying a trade.
Dow Jones-30
COT Change (52W) / C – 22%, LS –22% /
The larger than average cot change may cause a little decline, but the I’d say it is the extreme that causes me to think: the rally isn’t over yet!
Mexican Peso
COT Extreme / C – 51, LS - 51 report COT extreme /
The bullish cot extreme in the beginning of this year has stopped the decline in prices. There is plenty of space for Traders to build up larger positions --> the rally should continue.
Euro
COT Extreme / C – 44, LS - 43 report COT extreme /
Until we reach a significant bearish cot extreme I would say that prices can go higher. I would expect the trend to change when LS reach 100.000 contracts (or above) net long, C reach 100.000 contracts net short (or below) net short.
I read every day a part of this thread, working me through on every post which takes quite some time. At the moment I am at number 47.
I have observed 3 things until now which I would like to share with you:
post number 44: who is Thomas and what kind of review did you mention there? I did not get this one
a suggestion would be when you make you weekly reviews to take a look at your analysis from last week to see if they worked or not. You do it sometimes, but only if the element of your new COT report analysis was also one of the three elements of your last weeks COT report. I mean it is of course a bit more work but an evaluation always help for further success.
It is quite interesting to see the difference between your report an mine I guess the mix of the two is maybe the best. I like a lot in your charts that it shows a visual presentation which is always good for explanations as it makes things easier to understand. My problem is though that the charts do not show the percentile but volume. Although I find volume important, in these charts we can only see if volume is on an extreme but maybe it has nothing to do with percentile distributions and as far as I see it has produced many false signals!
I’m sure if you put this much energy into your studies, you’ll become an excellent “cot analyzer”!
-post44: He is this guy at cotbase who does the weekly reviews.
-your suggestion: I understand, but don’t forget, I analyze more or less all major futures markets:)
-the charts do not show the percentile volume: The cot charts show the net positions of Traders (contracts). I understand that it would be nice to see also the percentage for each Trader category: who is long and who is short --> this would have added value. False signals: as in all indicators, here it is also true: not all signals work, but (!) in my experience, cot extremes and I mean large ones, are usually pretty accurate in telling when a trend has come to a turning point.
I would like to answer for your last sentence. Actually I put so much energy in it because I also think that the COT extremes give a great idea where a turning point is. But exactly that is what I find hard with charts. If the percentile says to me it is a COT extreme because 99% of non-commercials and small speculators are long then it does not matter what the chart say because it really indicates a turning point. However on the chart I have seen that the chart is at an extreme point, still the currency goes quite a lot in the wrong direction. It happened also very often on the charts that the chart does not indicate anything and we have seen a COT extreme. That is why I think it is a bit more difficult to look at the charts. However I will watch out for everything and decide after more experience what is the right solution to make decisions.
I also do not see clearly until now what is the “right” time for the charts to make the decisions.
I understand clearly what you are saying: knowing the net amount of contracts only, without the short%long% of Traders could generate false signals in those circumstances when the total OI in the market is very large or very low… this sounds interesting but at the same very logical.
I’d be very much interested to see these figures charted under the price chart, cot charts.
I think we can agree then that graphical representation of these data help a lot in understanding the situation.
Japanese Yen
COT Change (52W) / C – 23%, LS – 17%, SS - 37 /
The larger change suggests that prices may rally in the next few days and since the last major cot extreme is also a bullish signal, the longer term picture also looks brighter for the Japanese yen.
Silver
COT Extreme / C – 43, LS - 581 report COT extreme /
Large Speculators have reached an extreme that we haven’t seen since 2003! It is an unquestionable bullish signal and luckily at a level where the Risk/Reward of the trade seems pretty decent!
Australian Dollar
COT Extreme / C – 56, LS - 56 report COT extreme /
We may talk about a relative bearish cot extreme, not more… of course as the last example shows, such extremes may also influence prices, but looking at the chart, there is no question that there could be much greater extremes ahead of us.
good to look at the analysis and compare with my fundamental bias.
I am also waiting for JPY strength and I am positioned for the move.
With silver it is not so easy. It is consolidating quite a lot. I also expect a gain for silver but quite a long time the currency does not move at all and I do not know how long this trend will still go. I rather took my money out and look for a better short-term investment.
The AUD… Hmmmm just like you said it is not on an extreme, my bias is bearish but the news are producing completely different progressions.
Rough Rice
COT Change (52W) / C – 23%, LS – 26% /
COT Index (3 yr.) / C – 77%, LS – 37%, SS – 2% /
We had a pretty large change in Commercials and also in Large Speculators positions (looking at the last one year history, the change size was in the top 10%). It seems as if the signal came a bit late, since last week Thursday and Friday prices have rallied. Since the cot extreme situation is still bullish, I’d say that the chances of further rallying prices is larger.
Australian Dollar
COT Extreme / C – 59, LS – 57, SS - 59 report COT extreme /
Not much change since last week: relatively we may talk about an extreme, but there is still reasonable space left for Traders to become even more extreme about the market. The cot report does not really give us an edge this time.
Soybeans
COT Extreme / C – 43, LS – 42, SS - 217 report COT extreme /
The extreme is becoming really significant in soybeans (bullish picture). Commercials and Large Speculators have still got room for further positions, but in case of Small Speculators, they have reached All Time (close to it) extreme levels. I think prices can still decline for a while, but I’d be surprised if this decline continued for many weeks…
USD Index
COT Change (52W) / C – 48%, LS – 51% /
The change in USD Index was HUGE (!), but not unseen… Large Speculators are long again (above 20.000 contracts net long), but the signal is still a bearish one. The last major cot extreme was a few months ago and it was a bullish signal. I don’t believe that in the medium/long term we need to expect any serious price declines.
Crude Oil
COT Extreme / C,LS – All Time COT extreme /
The All Time extreme we have in Crude Oil now suggests that prices will not be able to rally further for too long… of course the all time extreme can be in the market for a few weeks or even months before any real change in the trend.
British Pound
COT Extreme / C – 359, LS – 340 report COT extreme /
The cot extreme in GBP is considerable and I’m expecting prices to reach a top soon.
Dow Jones-30
COT Change (52W) / C – 31%, LS – 28%, SS – 31% /
Let’s see, what do we have here… Cot extreme: we had a bullish cot extreme in the last couple of weeks, so rising prices is not surprising. The change in Traders positions this week was larger than average and a bearish signal, so we may consider a cautious trade downwards.
Orange Juice
COT Change (52W) / C – 22%, LS – 27% /
Looking at the chart it seems that cot changes were pretty effective in Orange Juice in the past years… The bullish cot change signal seems to be a good signal that we can act on.
British Pound
COT Extreme / C – 361, LS – 342 report COT extreme /
Prices have not yet reached their top, but as they go higher and higher, the cot extreme is becoming larger too… We may need to be a bit more patient, but I’m pretty confident that eventually prices will react to this large cot signal.
The Cable was the major loser during European morning yesterday, as the UK industrial production falling 0.7% mom in May, the biggest decline since August 2013, after a downward revised growth of 0.3% mom in April. Industrial production fell 1.3% mom in May, the biggest decline since January 2013, also from a downward revised growth of 0.3% mom in the previous month. Both scenarios were outside their forecasts, weakening the GBP at the launch of these indicators.
I guess the mix of the two is maybe the best. I like a lot in your charts that it shows a visual presentation which is always good for explanations as it makes things easier to understand. My problem is though that the charts do not show the percentile but volume. Although I find volume important, in these charts we can only see if volume is on an extreme but maybe it has nothing to do with percentile distributions and as far as I see it has produced many false signals!
