CFTC COT (Commitment of Traders) Report Forecast a Gold Decline?
In recent past, I have cited the CFTC COT (Commitment of Traders) report's record open interest by large specs and record short open interest by commercials as a possible negative for Gold prices. Never one to trust myself, I decided to dig deeper to find out if my claim held water.
In fact, there is no recent evidence that such extremes in commercial shorts and large spec longs are negative factors on subsequent price action.
https://www.peterlbrandt.com/wp-content/uploads/2016/06/CFTC-COT-Commitment-of-Traders-impact-on-Gold-Peter-Brandt.jpg7611333Peter Brandthttps://www.peterlbrandt.com/wp-content/uploads/2020/04/TheFactorReport-small-logo.jpgPeter Brandt2016-06-30 09:25:222016-06-30 09:50:34Does the current CFTC COT Report forecast a decline in Gold prices?
Recent events only highlight the importance of Risk Management. Late Thursday evening and early Friday morning I spoke by phone to many of the old-timers (some with near 50-year trading careers) in whom I have the highest level of respect. There was a universal consensus – we have never witnessed markets like those experienced over such a brief period of time. Even though I had almost no exposure, I stayed up into the late hours on Thursday evening watching in awe a broad level of volatility exceeding anything I can remember. There was, no doubt, some serious blood-letting. In the weeks ahead we will read and hear about some horror stories. More than one trading firm will announce bankruptcy. We will not hear about the hundreds of individual speculators whose accounts were destroyed.
The British government allows large hedge funds to conduct their own exit polling. They are not allowed to release their findings until 22:00 British Summer Time (BST) — there is no prohibition against their trading based on their own Brexit exit polling.
Properly sampled Brexit exit polling in UK voting is extremely accurate (usually within a +/- 1% error). Hedge funds will have a good indication on the Brexit vote by midday BST and will almost certainly have solid data by 18:00 BST. There is an embargo on publishing results until 22:00 BST. Thus, hedge funds will have a lead of many hours over the average market speculator.
The dominant chart construction in Natural Gas is the completed 7- month H&S bottom on the daily graph (Oct contract). Note the appearance of a possible 6-day flag on the Oct chart.
The dominant chart construction in Treasury Bonds (T-Bonds) is the 10-month symmetrical triangle completed on the weekly continuation graph in late Jan. The Sep T-Bonds futures contract has decisively completed a 4-month inverted H&S pattern on the daily graph. The advance this past week also completed the 4-month congestion zone on the daily continuation graph (not shown). Factor (see premium service here) is long the Sep contract. Stops have been advanced to just below Wednesday’s low.
Coffee Futures are brewing again. Historically, the Coffee market has been a yo-yo — major Coffee bull markets followed by major bear markets, as shown by the quarterly graph. The market has been trading in an area of historical support.
Does the current CFTC COT Report forecast a decline in Gold prices?
/by Peter BrandtCFTC COT (Commitment of Traders) Report Forecast a Gold Decline?
In recent past, I have cited the CFTC COT (Commitment of Traders) report's record open interest by large specs and record short open interest by commercials as a possible negative for Gold prices. Never one to trust myself, I decided to dig deeper to find out if my claim held water.Always Consider Risk Management
/by Peter BrandtRecent events only highlight the importance of Risk Management. Late Thursday evening and early Friday morning I spoke by phone to many of the old-timers (some with near 50-year trading careers) in whom I have the highest level of respect. There was a universal consensus – we have never witnessed markets like those experienced over such a brief period of time. Even though I had almost no exposure, I stayed up into the late hours on Thursday evening watching in awe a broad level of volatility exceeding anything I can remember. There was, no doubt, some serious blood-letting. In the weeks ahead we will read and hear about some horror stories. More than one trading firm will announce bankruptcy. We will not hear about the hundreds of individual speculators whose accounts were destroyed.
Brexit Exit Polling by Hedge Funds
/by Peter BrandtThe British government allows large hedge funds to conduct their own exit polling. They are not allowed to release their findings until 22:00 British Summer Time (BST) — there is no prohibition against their trading based on their own Brexit exit polling.
Properly sampled Brexit exit polling in UK voting is extremely accurate (usually within a +/- 1% error). Hedge funds will have a good indication on the Brexit vote by midday BST and will almost certainly have solid data by 18:00 BST. There is an embargo on publishing results until 22:00 BST. Thus, hedge funds will have a lead of many hours over the average market speculator.
Natural Gas Rising
/by Peter BrandtThe dominant chart construction in Natural Gas is the completed 7- month H&S bottom on the daily graph (Oct contract). Note the appearance of a possible 6-day flag on the Oct chart.
Treasury Bonds (T-Bonds) are Constructive
/by Peter BrandtThe dominant chart construction in Treasury Bonds (T-Bonds) is the 10-month symmetrical triangle completed on the weekly continuation graph in late Jan. The Sep T-Bonds futures contract has decisively completed a 4-month inverted H&S pattern on the daily graph. The advance this past week also completed the 4-month congestion zone on the daily continuation graph (not shown). Factor (see premium service here) is long the Sep contract. Stops have been advanced to just below Wednesday’s low.
Coffee Futures are Brewing
/by Peter BrandtCoffee Futures are brewing again. Historically, the Coffee market has been a yo-yo — major Coffee bull markets followed by major bear markets, as shown by the quarterly graph. The market has been trading in an area of historical support.