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The Weekly Commitments of Traders Report
Know what the “smart money” is up to
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For most recent reports go to
Commitments of Traders
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To learn how to use C.O.T go to
Commitments of Traders – An Ultimate guide
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For more weekly C.O.T tracking go to
Commitments Of Traders Sheet
[/stm_icon_box][/vc_column][/vc_row][vc_row full_width=”stretch_row”][vc_column][vc_separator color=”sky” border_width=”7″][/vc_column][/vc_row][vc_row][vc_column width=”1/12″][/vc_column][vc_column width=”10/12″][vc_column_text]The Commitments of Traders Report is issued by CFTC.
It reports all open positions in futures markets of three main groups of traders:
- Commercial Traders – Hedgers
- Non-Commercial Traders – Money Managers
- Non-Reportable – Retail market
The report breaks down each Tuesday’s Open Interest and gives us a powerful view on what exactly the big guys have been doing in the marketplace and what their plans might be.
It is issued every Friday and includes data from Tuesday to Tuesday.
The three days prior to the release date are not included.
This is an essential tool for gauging long term sentiment in futures markets.
NOTE:
In this report, we cover EURO, GBP, AUD, JPY, CAD, and we focus on Non-Commercial traders as an indication of a profit driven bias.
C.O.T Positioning
EURUSD: Bullish
GBPUSD: Bullish
AUDUSD: Bullish
USDJPY: Mixed
USDCAD: Bearish
EURO – Euro Futures
My Bias: Bullish
The euro slipped lower as investors struggled to find reasons to buy into the common currency, despite upbeat European Central Bank minutes from the December meeting. The minutes showed that there was a cautious optimism among policy makers that there are mild indications of core inflation is rising. Whilst these comments underpinned the euro, the ECB minutes also showed that the central bank was more cautious on the state of the economy as a whole.
Positions:
Despite lower prices, speculators kept covering their short positions for 4th consecutive week.This week they closed 14.4K of their shorts and 932 of their long positions. They were 48K – down from being 62K in the previous week. Net speculative positions trend above 33 weeks moving average, which confirms bullish bias. Overall the sentiment looks to the upside for EURUSD. I would expect the current decline in the price is a short term correction and an opportunity to buy EURUSD in the longer term.
Strategy:
Buy EURUSD on dips
GBP – British Pound Future
My Bias: Bullish GBPUSD
The UK retail sales for December was released a while ago and it was yet another disappointing report. Retail sales posted another decline of 0.6% in December, which is the fourth decline in the last five months. The GBP has turned bearish immediately after that and has lost nearly 100 pips. Below are the details:
The revision for November was negative as well, from -0.6% to -0.8%. YoY sales also came much lower at 0.9% against 2.7% and the previous number was revised lower too, from 1.0% to 0.8%. Core sales were also very disappointing, showing a 0.8% decline last month.
Positions:
Speculators kept the bullish dynamic despite a negative news from the market. This week they covered another 14K of their shorts and added fresh 1.5K of long positions to their portfolios. They were 31.5K net long, levels not seen since April 2018. The current decline in price is an excellent opportunity to build up long term long positions in GBPUSD.
Strategy:
Buy GBPUSD on dips.
JPY -Japanese Yen Futures
My Bias: Mixed USDJPY
For the US dollar, it was firmer in the US session following a turn in US data, bucking the negative trend of late whereby Retail Sales rose 0.3% MoM (control group rose 0.5%, est. 0.4%). this was in line with estimates but nevertheless encouraging. The US Jan Philly Fed index at 17.0 also encouraged a bid in the US dollar, beating expectations (est. 3.7, prior 2.4) to retest mid-2019 highs. The data and showed solid gains in employment and new orders components.
Stocks are set to open higher with the Dow futures implying a 82 point gain, the Nasdaq up 36 points and the S&P up 8.29 points.
The US yields are moving higher (supportive of the dollar) with the 10 year up 3.3 bps at 1.8408% after being as low as 1.811% earlier today.
Positions:
This week speculators added fresh 21K new short positions and only 1.8K long positions. This is a fairly bearish outlook ( bullish USDJPY ) and it is confirmed by the current price action. I expect USDJPY to keep climbing to fresh highs in the next few weeks.
Strategy – no change:
Buy USDJPY on dips
AUD -Australian Dollar Futures
My Bias: Bullish AUDUSD
The Australian dollar has gone back and forth during the trading session on Friday, as we continue to see a lot of back and forth when it comes to risk appetite. That being said, the Australian dollar continues to hang around the 200 day EMA and it is very likely that the longer-term traders will be paying attention to this, and the fact that the last week has been so choppy tells me that we are in the process of trying to decide where to go next, and that of course could be a scenario that keeps the market noisy but eventually making a significant move. All things being equal, I believe that this market will give us plenty of opportunities to go along, and we are in the midst of a trend change which is always a very difficult and messy situation.
Positions:
Speculators took profits this week. They covered 8.3K of their long positions and 15K of their short positions. They were 20K net short, which was down from being 27K in the previous week. Overall, there is no reason to believe AUDUSD is reversing to the downside. Speculators are less bearish this week and this should support the price to the upside. Treat the current decline as a buying opportunity.
Strategy:
Buy AUDUSD on dips.
CAD – Canadian Dollar Futures
My Bias: Bullish USDCAD
The Canadian dollar is drifting lower in early Toronto trading, after stagnating overnight. The catalyst for this morning’s selling pressure is just broad U.S. dollar demand, stemming from weak U.K. and European economic data releases.
The Canadian dollar is not alone. AUD/USD and NZD/USD are inching lower alongside the Loonie, as the positive sentiment from China and the US signing the Phase 1 Trade Agreement fades. Analysts are suggesting that the benefits from the deal are degraded because both sides are keeping existing tariffs in place. China Q4 Grpss Domestic Product rose 6.0% y/y in December, which was as forecast. It is the lowest growth in 30 years. However, the easing of trade tensions suggests there is upside potential in 2020. China Retail Sales rose 8.0%/y/y while Industrial Production was 6.9% y/y. Both results were better than expected.
Positions:
No much action in CAD futures markets this week. Speculators added fresh 1.6K of long positions and 5K of short positions. They were 323K net long, which was up from being 32K in the previous week. The trend remains to the downside and it is likely to continue for another few weeks.
Strategy:
Sell USDCAD on rallies
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