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Weekly COT report Analysis + Trade Ideas

  • #261
  • Feb 20, 2010 9:08am Feb 20, 2010 9:08am
Quoting Patience
G'day Shahab

Same sort of picture on USDX - classic bearish divergence on daily with doji on weekly. We had 7-8 weeks of chop in this area on the way down but that was over the Summer months. I'll take a look at Kiwi - haven't traded that for a while.

oh my bad- i meant E/U will correct higher !!! as i dont trade USDX i always consider it the mirror of E/U :-)
  • #262
  • Feb 20, 2010 9:15am Feb 20, 2010 9:15am
Kiwi- 2nd thought- this one bothers me - may be we need to wait a bit- however we did see the down move (a short one 2days) after that, a beark above .7080 will clear the bullish count
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  • #263
  • Feb 20, 2010 9:28am Feb 20, 2010 9:28am
Quoting shahab8b
Kiwi- 2nd thought- this one bothers me - may be we need to wait a bit- however we did see the down move after that, a beark above .7080 will clear the bullish count
It's been trying really hard to break 200 SMA on daily but hasn't been successful yet.

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Of course it is the monthly candles on USDX that I find off-putting. Just checked ATR on monthly EUR. Last 52 months ATR has been 614 pips. EUR has done 584 from high to low for Feb. Makes me think USD weakness early week and finish the month off strong.

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Nothing worth having is easy.
  • #264
  • Feb 20, 2010 9:29am Feb 20, 2010 9:29am
Quote
G/U ; larger traders added to their shorts over last week: from 52,756 to 56,079 contracts ,
open interest (total short/long in all groups) is highest over a year,
all warns of a high probability of an upward correction

Hi Shahab,

Since you are a COT report expert , i want to ask you:

I am also thinking G/U should head higher based on fibs,monthly pivots, candlestick pattern. But if it wants to head higher, then why are large traders increasing their shorts?

Does COT report and currency price goes in opposite direction?

I am new in analysing COT report, so your guidance will be helpful.

Same goes with EUR/USD. I have come to conclusion that i should go long on E/U based on my trading system. But when i look at the COT report, it says large traders have increased net short euro positions.
  • #265
  • Feb 20, 2010 9:39am Feb 20, 2010 9:39am
Quoting kingfisher
Does COT report and currency price goes in opposite direction?
Could be suggesting trade is crowded but can remain extreme up to many weeks at times before reversal is seen.
Nothing worth having is easy.
  • #266
  • Feb 20, 2010 9:54am Feb 20, 2010 9:54am
Quote
Could be suggesting trade is crowded but can remain extreme up to many weeks at times before reversal is seen.

Thanks Patience.

Can we also say:

Lets say G/U is rising in the next few days/weeks and if we see COT report says net short increasing in GBP, then are Large traders are building short positions in the rising market for a fall later on?
  • #267
  • Feb 20, 2010 9:54am Feb 20, 2010 9:54am
What's gold up to though? Above daily, weekly and monthly pivots. Looks like more gains to be had to me. Need to break $1,125 convincingly? Soros has been busy

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Nothing worth having is easy.
  • #268
  • Feb 20, 2010 9:54am Feb 20, 2010 9:54am
Quoting kingfisher
Hi Shahab,

Since you are a COT report expert , i want to ask you:

I am also thinking G/U should head higher based on fibs,monthly pivots, candlestick pattern. But if it wants to head higher, then why are large traders increasing their shorts?

Does COT report and currency price goes in opposite direction?
hi kingfisher,
patience has already answered your question,
besides you can read the first post of this thread,
here are the hint:

1-Net position Long + trend up + COT index normal> only trade long
2-Net position Short + trend down + COT index normal > only trade short
3-Net position Long # trend down > stand aside or go just technical
4-Net position Short#trend up >stand aside or just technical
5-Net position Long+trend up+ COT index Extreme> watch for reversal/correction
6-Net position Short+trend down+COT index Extreme> watch for reversal/correction

#6 is the case for E/U and G/U
#5 is the case for U/Chf
#1 for A/U
#2 for U/cad
#3 for Kiwi
  • #269
  • Feb 20, 2010 9:56am Feb 20, 2010 9:56am
Quoting shahab8b
hi Victory, draw me the pattern and post it here
AUDUSD240
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  • #270
  • Feb 20, 2010 10:03am Feb 20, 2010 10:03am
Quoting Victory83
AUDUSD240
do you mean 5-0 pattern?
look at the pdf file of 5-0 pattern here

http://www.harmonictrader.com/The5-0Pattern.pdf

then tell me if that's the case here
  • #271
  • Feb 20, 2010 10:37am Feb 20, 2010 10:37am
hi shahab this is my first post here to really thank you for a very good info and education .this week coming is going to be very intresting as we r at critical levels usdollar broke a solid res at 80.5 will it hold the test and go up . well for aud wave 4 may be formed on 4h which will give us wave2 on daily i was looking for .764fib of the last rally but it didnt get there and reached .618 fib which is still valid for wave 2 and this could be the mirror for gold as well . so i m looking for a collapse for the majors against the dollar and gold . eur is going down from 1.365-1.37 to fib exp 161.8 at 1.307 and that will be wave 3 . this my view and i have few shorts on eur/usd and i m waiting for more confirmation on aud /usd and i have a short on gold with sloss at 1130 . any comment is apperciated
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  • #272
  • Feb 20, 2010 10:45am Feb 20, 2010 10:45am
Quoting shahab8b
do you mean 5-0 pattern?
look at the pdf file of 5-0 pattern here

http://www.harmonictrader.com/The5-0Pattern.pdf

then tell me if that's the case here
it seems kind of 0-5 but i use determined fibo levels for Reciprocal (I usually look for Reciprocal 1.27 and .78 in 240 min charts). i read this pdf before and Carney's books.these two pattern are similar, and both are really strong, but i think they are different from fibo levels view point. it worked out very well.
i am sure you know more than me, so i would be grateful you correct me if i made mistake.
  • #273
  • Feb 20, 2010 11:09am Feb 20, 2010 11:09am
Quoting nawafasad1
hi shahab this is my first post here to really thank you for a very good info and education .this week coming is going to be very intresting as we r at critical levels usdollar broke a solid res at 80.5 will it hold the test and go up .
hi nawafasad,
thanks for your appreciation,
I agree with you on A/U provided 61% holds, (R at .9035)
having a bullish count for USDX for a couple of next days will take that R out
look at U/cad we broke below 61%- so we will see it here at A/U in 1-2 days delay, IMO
in general I'd let this pair go up more then short it at a S>R level-
  • #274
  • Feb 20, 2010 11:21am Feb 20, 2010 11:21am
Quoting shahab8b
hi nawafasad,
thanks for your appreciation,
I agree with you on A/U provided 61% holds, (R at .9035)
having a bullish count for USDX for a couple of next days will take that R out
look at U/cad we broke below 61%- so we will see it here at A/U in 1-2 days delay, IMO
in general I'd let this pair go up more then short it at a S>R level-
thank you shahab for this i see your point and i will wait for confirmation on this as i have few deals on eur and gold . i dont need more losses if i was wrong lol
  • #275
  • Feb 20, 2010 12:08pm Feb 20, 2010 12:08pm
Quoting Victory83
it seems kind of 0-5 but i use determined fibo levels for Reciprocal (I usually look for Reciprocal 1.27 and .78 in 240 min charts). i read this pdf before and Carney's books.these two pattern are similar, and both are really strong, but i think they are different from fibo levels view point. it worked out very well.
i am sure you know more than me, so i would be grateful you correct me if i made mistake.
that's great if you read whole Carney's books. do you have them on pdf or hard copy?
I didn't used reciprocal abcd before but the 05 pattern doesn't need any pattern recognition to trade- just use simple S turns R/ or visa versa to trade.

if you are good at harmonic patterns (they really need sharp eyes to be recognized) post them here whenever you find them- we like to trade them as well
  • #276
  • Feb 20, 2010 1:11pm Feb 20, 2010 1:11pm
U/J buy at current level and add at retest of R>S 91.25 aiming for 97ish
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  • #277
  • Feb 20, 2010 7:52pm Feb 20, 2010 7:52pm
G/U 2nd thought
diamond top is what I saw before - I was thinking for an ab=cd but I cant convinced myself for a big move up- may be just a correction and then I expect that price meets 69-76% of the top/bottom of the pattern (of diamond) - according to thomas bukowski , he says 69-76% of the pattern from breakout point
having said that I expect to see 1.48 in 2-4 weeks
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  • #278
  • Feb 21, 2010 12:43am Feb 21, 2010 12:43am
Quote
hi kingfisher,
patience has already answered your question,
besides you can read the first post of this thread,
here are the hint:

1-Net position Long + trend up + COT index normal> only trade long
2-Net position Short + trend down + COT index normal > only trade short
3-Net position Long # trend down > stand aside or go just technical
4-Net position Short#trend up >stand aside or just technical
5-Net position Long+trend up+ COT index Extreme> watch for reversal/correction
6-Net position Short+trend down+COT index Extreme> watch for reversal/correction...

Thanks Shahab for a wonderful reply. I appreciate your time.

I have read your first post and currently reading more about COT index. It looks to me COT index is an another leading indicator which can be added to a trading system.
  • #279
  • Feb 21, 2010 1:16am Feb 21, 2010 1:16am
Quoting kingfisher
Thanks Shahab for a wonderful reply. I appreciate your time.

I have read your first post and currently reading more about COT index. It looks to me COT index is an another leading indicator which can be added to a trading system.
The COT report is certainly not a leading indicator..... It is 4 day old news by the time we get it, and a lot can change in that time..... This is not to say it isn't useful just not as current as we would really like.
  • #280
  • Edited 7:25am Feb 21, 2010 7:14am | Edited 7:25am
USDCHF sell a break of 1.0725
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