Hi FE,
I was quoting Steve Briese from his book on COT. I think he is trying to make the point that in the COT there is much mis-information, he is thus listing the more common.
I had read William’s book first, there seemed to be answers but there were many more questions still in my mind. He gave great detail, for example, on reading Open Interest.
Briese answers many of the questions. He gives detailed answers on the control that each player category exercises, for example “They (commercials) control the overwhelming majority of the open interest in most markets”.
In his analysis of the common “Tip -always follow the commercials” as frequently attributed to Williams, Briese points out that “you had better have deep pockets”.
Briese suggests where such deep pockets are not required and yet we can follow the commercial action:-
“For most of us, better results will accrue from buying at the moment commercials QUIT buying (or moving short just as commercials STOP selling).
It is rare to see commercials stop buying before prices find a bottom, or to see them quit selling ahead of a top. I use the term ‘commercial capitulation’ to describe these rare events, which are the only occasions when it safe to safe to BUY WHILE COMMERCIALS ARE STILL BUYING.”
On the small speculator thing, Williams refers to the ‘great unwashed public’ I think was the term, and points out how often they have been wrong.
Briese points out the the non reportables include not only the public but also commercial and speculators alike, thus in his words their “net position pattern is a real mishmash”.
For me, after reading William’s book I couldn’t find value in the cot. Then when reading Briese’s book and seeing his final “mis-information tip” I had second thoughts.
"Tip - the cot is old news by the time it is read:
You would not have bought this book if you believed this tip. But for the record, even when the data was released only monthly, and 11 or 12 days after the fact, …I found the cot data frequently pointed out timely trading opportunities.
… you will, I hope, come to appreciate that analysing cot data in anticipation of gaining a trading edge is an attainable goal, but one that requires paying due attention to the details, and particularly to the nuances."
FE, The above tips, quotes and emphasis in both posts are not mine, they are Steve Briese’s, it is perhaps right that we discuss in this thread, in his preface he says:
" You can think of the cot as a sentiment indicator, but instead of opinion surveys, it is based on actual market positions of the largest futures traders. You can also think of it as a fundamental indicator, because it lets you know the market positions - and therefore the price outlook - of the firms who operate the cash markets and who use futures to hedge price risk. When these market insiders move to one side of the market en masse, even swap dealers and hedge funds can get flattened."
BTW because of your prompting I have decided to re-read this book for a third time 
