Latest CFTC Release Dated December 4, 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.
[B]Explanation of Charts:[/B]
[B]Commercial % Long (RED):[/B] # 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
[B]Speculative % Long (RED):[/B] # 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
[B]52 Week COT Index (BLUE):[/B] see description just below the COT Index table
[B]13 Week COT Index (BLUE):[/B] see description just below the COT Index table
[B]US Dollar Index: [/B]The % of total commercial positions that are long measured through a 52 week percentile is at 10 and the % of total speculative positions that are long measured through a 52 week percentile is at 59. Speculators are buying dollars right now and hedgers are selling. The dollar is likely to gain for a week or two more until a short term bullish extreme is registered.
[B]Signal: [/B]Bullish
[B]EUR: [/B]The % of total commercial positions that are long measured through a 52 week percentile is at 90 and the % of total speculative positions that are long measured through a 52 week percentile is at 41. The 13 week COT index is at 8 and argues for a EUR low to form in the next week or two.
[B]Signal: [/B]Bearish
[B]GBP[/B]: The % of total commercial positions that are long measured through a 52 week percentile is at 90 and the % of total speculative positions that are long measured through a 52 week percentile is at 41. The COT index is trending down, which favors bears until conditions are extreme.
[B]Signal: [/B]Bearish
[B]CHF:[/B] The % of total commercial positions that are long measured through a 52 week percentile is at 12 and the % of total speculative positions that are long measured through a 52 week percentile is 90. Both groups indicate that the CHF is reaching a ceiling and is set to weaken (bullish for USDCHF).
[B]Signal: [/B]Bearish
[B]JPY: [/B] 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. The 52 week COT index is at 98 and favors a continued JPY weakness (bullish for Yen pairs).
[B]Signal: [/B]Bearish
[B]CAD: [/B]The % of total commercial positions that are long measured through a 52 week percentile is at 55 and the % of total speculative positions that are long measured through a 52 week percentile is at 41. The 13 week COT index is at 0, indicating that the CAD is likely near a short term bottom. However, the 52 week measure is trending down, indicating that the larger trend is down.
[B]Signal: [/B]Bearish but a short term bottom may be in place
[B]AUD:[/B] The % of total commercial positions that are long measured through a 52 week percentile is at 80 and the % of total speculative positions that are long measured through a 52 week percentile is at 20. The 52 and 13 week COT indices are at 4 and 8. Readings this low indicate that an important low may very well form in the next few weeks.
[B]Signal: [/B]Bearish
[B]NZD:[/B] The % of total commercial positions that are long measured through a 52 week percentile is at 63 and the % of total speculative positions that are long measured through a 52 week percentile is at 20. The 52 and 13 week COT indices are at 22 and 33. The indices have turned up from bearish extremes, which is bullish for NZD.
[B]Signal: [/B]Bullish