Love this Commitments of Traders stuff. It always fascinates me to see what this data will pull out of its touque. Speaking of which, I gotta dig mine out soon! The nights are getting chilly up here in the mountains of Quebec. Maybe that coyote we saw the other day could make a nice hat. But I digress. My trading setups based on the COT data have given a few interesting new signals from today's update on trader positioning in derivatives markets. (See all the signals at the table linked at the top of my latest signals page.)
My long-standing bullish signal for the 10-year Treasury note has just gone bearish (meaning it's calling for the yield to rise). I posted a note last week on the divergence between the 10-year data and my still-quite-bullish setup for the three-month Fed Funds contract (see here). If the trend-setting yield does indeed rise, that wouldn't be a good sign for hopes of economic recovery. By the by, my 10-year setup has a trade delay of four weeks, so I'll sell my long position on the open of Sept. 29.
My setup for natural gas has also gone bullish. After the nutso week that market just had, I'm hoping it's now made a good base. But I'm still prepared for a wild ride. Gas is like that. Explosive! (This setup has no trade delay, meaning execution on the open after the weekend.)
My S&P 500 setup has gone to cash. But this signal isn't too relevant for my purposes since I had ignored it due to my risk-control rule. (See more on why in this post and more on this rule here.)
A couple of other interesting developments:
- Commercial traders in U.S. dollar index futures now have their sixth-most bearish net short position since 1992.
- Gold small traders haven't had such a small net long percentage-of-open-interest position since Sept. 2006 in comparison to the past data. That's when gold was basing below $600. Last week, their position was the second-most bearish it's ever been in comparison with the average I use for my setup for the HUI Gold Bugs Index and XGD Canadian Gold iShares.
Hope you have a good long weekend, and be sure to tune in early next week for my portfolio page update and perhaps, finally, some more news on my a new copper setup.
TAGS: S&P 500, natural gas, gold, U.S. dollar, HUI, Gold Bugs, XGD, iShares, Treasuries, 10-year Treasury, interest rates, Fed Funds, COT, Commitments of Traders, market timing, trading system development, CFTC, Commodity Futures Trading Commission, COTs Timer
Read more at:
Recommend this article... Related items
Last update : 29-08-2008 13:24
|
(0 vote)
