Latest CFTC Release Dated November 13, 2007:
The COT Index is the percentile of the difference between net speculative positioning and net commercial positioning measured over the last 52 weeks. A reading close to 0 suggests that a bottom is forming and a reading close to 100 suggests that a top is forming. The readings are for the actual currency, not the currency pair. For example, a reading of 100 on the Canadian Dollar suggests that the Canadian Dollar is close to a top (USDCAD close to a bottom).
Readings of 95 and higher as well as 5 and lower are in boldfaced red type to indicate potential market extremes. The last 4 weeks of the COT Index are shown because it is just as important to know where the index is coming from. For example, an increasing index is bullish until the index is extreme (near 100), at which time the risk of a reversal or pause in the trend increases.
Explanation of Charts:
Commercial % Long (RED): # COMMERCIAL LONG CONTRACTS / (TOTAL # COMMERCIAL CONTRACTS) and measured with a 52 week percentile…commercials are very long at the bottom and very short at the top
Speculative % Long (RED): # SPECULATIVE LONG CONTRACTS / (TOTAL # SPECULATIVE CONTRACTS) and measured with a 52 week percentile …speculators are very long at the top and very short at the bottom
52 Week COT Index (BLUE): see description just below the COT Index table
13 Week COT Index (BLUE): see description just below the COT Index table
US Dollar Index: The % of total commercial positions that are long measured through a 52 week percentile is at 24 and the % of total speculative positions that are long measured through a 52 week percentile is at 28. With both groups remaining neutral, the bias is for the weak dollar trend to continue.
EUR: The % of total commercial positions that are long measured through a 52 week percentile is at 84 and the % of total speculative positions that are long measured through a 52 week percentile is at 24. Positioning continues to favor euro gains until both groups are extreme.
GBP: The % of total commercial positions that are long measured through a 52 week percentile is at 78 and the % of total speculative positions that are long measured through a 52 week percentile is at 39. Both groups are neutral. Until both are extreme, there is no reason to expect a major turn.
CHF: The % of total commercial positions that are long measured through a 52 week percentile is at 0 and the % of total speculative positions that are long measured through a 52 week percentile is at 98. Both groups indicate that the CHF is reaching a ceiling and is set to weaken (bullish for USDCHF). The 52 week COT Index is at 98 (extreme) and the 13 weak index is at 92, both of these readings support the reversal scenario.
JPY: The % of total commercial positions that are long measured through a 52 week percentile is at 0 and the % of total speculative positions that are long measured through a 52 week percentile is at 98. Both groups indicate that the CHF is reaching a ceiling and is set to weaken (bullish for USDCHF). The 52 week COT Index is at 98 (extreme) and the 13 weak index is at 92, both of these readings support the reversal scenario.
CAD: The % of total commercial positions that are long measured through a 52 week percentile is at 33 and the % of total speculative positions that are long measured through a 52 week percentile is at 86. After turning when conditions were at a CAD bullish extreme, this should prove to be a major turn towards CAD weakness.
AUD: The % of total commercial positions that are long measured through a 52 week percentile is at 76 and the % of total speculative positions that are long measured through a 52 week percentile is at 33. Both groups are neutral. Until both are extreme, there is no reason to expect a turn.