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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: Bearish
AUDUSD: Bullish
USDJPY: Bearish
USDCAD: Bearish
EURO – Euro Futures
My Bias: Bullish
The Euro tried to break out during the trading session on Thursday, as the ECB added a ton of liquidity into the system. While normally bad for a currency, the initial reaction was very bullish. Since then, the markets have calmed down a bit and it looks as if the 1.1250 level is going to continue to offer a bit of a barrier. With that in mind, I do think that if we break down below the lows of the Thursday session, we can begin the correction that is so desperately needed in this market.
Positions:
This week speculators took profits. They covered 622 of their long positions but at the same time they liquidated 6.6K of their shorts. This adjustment took place while the price of EURUSD spiked aggressively last week ending the week at 1.1283. Speculators were 81K net long. The current level of bullishness is nowhere near the extreme levels we noted in April 2018 ( 145K net long ). It looks like EURUSD has a lot of room to the upside and this direction is likely in the coming weeks.
Strategy:
Buy EURUSD on dips
GBP – British Pound Future
My Bias: Bearish GBPUSD
Recent losses have taken GBP/USD into the lowest level in almost two months, with the pair attempting to regain ground in recent hours. Despite the possibility of short-term upside from here, we are looking set for further downside given the breakdown below $1.2166 shown on the four-hour chart.
That break highlights the completion of a topping pattern, with further losses looking highly likely. With that in mind, a bearish outlook remains in play unless we see a break back through the $1.2238 swing high. Until we break that level, any short-term upside would be viewed as a selling opportunity rather than the basis for a long-lasting rebound.
Positions:
There are a few conflicting signals in GBP positions this week. Speculators covered a significant amount of their long positions, 12.2K while the price of GBPUSD spiked and ended the week at 1.2665 – 3 months high. At the same time, they added only 1.5K of short positions. This outlook would suggest a rather bearish sentiment but the price action prevailed and speculators were caught on the wrong side of the transactions. They were 36K net short, which was the highest level for a long time, but still way off the most recent extreme ( 90K ) back in August last year. Let’s see how the positions behave next week. I would like to think that speculators will reverse their sentiment to bullish following up the price action. Lets see…
Strategy:
Pause
JPY -Japanese Yen Futures
My Bias: Bearish USDJPY
The US dollar has rallied a bit against the Japanese yen during the trading session on Thursday, breaking above the ¥109 level. At this point, the market is likely to see a little bit more pressure in the pair, especially considering that the jobs numbers coming out on Friday. The Non-Farm Payroll figures are massively influential would it comes to this pair, so do not be surprised to see some type of big move at one point or another during the day.
If we do break above this little area just north of the candlestick, it is likely that the dollar will go looking towards the ¥110 level. This is more or less a “risk-on” type of trade, so having said that it will be interesting to see how the stock markets behave.
Positions:
This week speculators added to both sides of a transaction. They got 4K new long positions and 6.1K of short positions. They were 32.5K net long, which was only a small bit changed from 34.6K in the previous week. The price action was bullish last week and it looks like speculators are on the wrong side of the market on JPY Futures too.
Strategy :
Pause
AUD -Australian Dollar Futures
My Bias: Bullish AUDUSD
The Aussie hit a high of 0.6983 against the dollar earlier today and closed in on the 0.7000 handle, before being pegged back to around 0.6930-40 levels in early European trading.
One can allude to hints of profit-taking and amid the unrelenting move of nearly 8% since last month, perhaps there is room for some correction upon nearing key levels.
The Aussie has now slipped to a session low of 0.6880 as we also see the dollar and yen recoup some losses across the board on the session. EUR/USD is still near 1.1200 but is off its high of 1.1228 earlier in the day with cable also falling back under 1.2600.
For AUD/USD, keeping below 0.6900 would be encouraging for sellers but they have much work to do to even try to wrestle back any near-term control with the 100-hour moving average still seen far away at 0.6745 currently.
Positions:
There was not much adjustment this week in AUD futures speculative positions. This week speculators added 1K for each long and short side. Speculative positions were unchanged. The price action spiked aggressively in the AUDUSD market. At this stage, it is likely that the market will follow up with more buying next week. I would expect AUDUSD to keep rallying in the coming weeks.
Strategy:
Buy AUDUSD on dips
CAD – Canadian Dollar Futures
My Bias: Bearish USDCAD
The Canadian dollar consolidated inside yesterday’s range as the U.S. dollar clawed back some losses overnight.
Wednesday’s Bank of Canada policy meeting lived up to its advance hype. It was expected to be a non-event, and it was. The BoC left interest rates unchanged at 0.25%. The statement was mildly positive, suggesting that the impact of COVID-19 on the economy had peaked, but hedged the statement by noting high uncertainty about how the recovery would unfold.
The BoC also managed expectations by saying “the level of real (Gross Domestic Product) in the second quarter will likely show a further decline of 10-20 per cent, as continued shutdowns and sharply lower investment in the energy sector take a further toll on output.”
It was also Stephen Poloz’s final meeting as Governor. His replacement, Tiff Macklem, attended the meeting but according to the BoC statement “He participated as an observer in Governing Council’s deliberations for this policy interest rate decision and endorses the rate decision and measures announced in this press release.”
Positions:
There was more profit-taking in the CAD market this week. This time speculators covered 2K of their long positions and 2.8K of their short positions. They were 33.1K net short, only a little changed from the previous week.
With speculators taking profits, I would expect more downside in this market in the coming weeks.
Strategy:
Sell USDCAD on rallies
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