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Weekly COT report Analysis + Trade Ideas

  • #341
  • Mar 2, 2010 3:17am Mar 2, 2010 3:17am
Quoting shahab8b
I'm definitely with Soros's idea that Euro is flawed- they have been saying that since 08 - but I'm looking technical
it is forming a pattern that has characteristics of a reversal pattern to my expeience

here is my observation:
I called a pattern failure

look at the chart its now emerging as triangle- this type of traignle should be a continuation pattern according to textbooks
right?
to me it's not- it will be a failure- why? because everybody keep pushing it lower- it's over crowded , the bearish sentiment is over extreme- ans it's not moving...
Was just looking at USDX. We have ascending triangle on 4 hour and daily. I think we will see more USD gains. It was interesting to note that Lloyds thought that the trade wasn't overcrowded in that report that I posted on the weekend:

The last set of IMM data (up until 16th Feb) showed
the market has added further to its short EUR and
GBP positions. Both GBP/USD and EUR/USD
positioning currently lie close to, or at the zero
percentile bound. Although there is talk now that the
market’s short euro position may be overcrowded, it
is worth bearing in mind that in May 2007, net long
contracts for EUR/USD were twice the amount that
are currently net short. This suggests there is still some
way lower to go before a major short squeeze higher.
GBP/USD positioning shows similar characteristics and
as such, we remain comfortable with our strategy of


selling into any EUR/USD and GBP/USD strength."


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Nothing worth having is easy.
  • #342
  • Mar 2, 2010 6:03am Mar 2, 2010 6:03am
Quoting Patience
Was just looking at USDX. We have ascending triangle on 4 hour and daily. I think we will see more USD gains. It was interesting to note that Lloyds thought that the trade wasn't overcrowded in that report that I posted on the weekend:

[left]The last set of IMM data (up until 16th Feb) showed[font=LloydsTSBVAGRounded-Light][size=1][color=#231f20]
[size=1][font=LloydsTSBVAGRounded-Light][color=#231f20][size=1][font=LloydsTSBVAGRounded-Light][color=#231f20][size=2]the...
hi, I see your point- are you trading that ascending triangle? selling E/U or G/U at this level?
I got stopped out at B/E at my E/U long-again!!
still stick to my analysis and holding long A/U and short U/cad- those two are in accordance to SSI report :-)
  • #343
  • Mar 2, 2010 9:11am Mar 2, 2010 9:11am
Quoting shahab8b
hi, I see your point- are you trading that ascending triangle? selling E/U or G/U at this level?
I got stopped out at B/E at my E/U long-again!!
still stick to my analysis and holding long A/U and short U/cad- those two are in accordance to SSI report :-)
Yeah, that was a nasty spike down on E/U. Maybe that was the last clean out before heading for your 1.40 target. I've just been jumping in and out of longs on A/J - it's my favourite. The Yen concerns me though. It's hardly moving. Why doesn't it just spike down and get it over with. Risk is on, indices up, I even got a buy possibility from the Jurik charts on weekly S&P, DJI and daily/weekly buy possibilities on A/U. Gold is so looking like it wants to break out. I'll just stick to scalping A/J.
Nothing worth having is easy.
  • #344
  • Mar 3, 2010 5:20am Mar 3, 2010 5:20am
more boring PA I see. Bloomberg TV just said that the Justice Department are looking into that nice little dinner that the hedge funds had where shorting the Euro was an item on the agenda. A "Do Not Destroy" your records has been issued to various hedge funds. What's up with that? Can't do anything these days without Big Brother watching over your shoulder.

SSI: USDCAD Ratio Jumps to Bullish Extremes as Retail Bears Take Profit, Longs Jump 14%
Wednesday, 03 Mar 2010 10:45 GMT
Written by Research Team

FXCM Speculative Sentiment Index (SSI) Statistics:

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SSI Details:

EURUSD - The ratio of long to short positions in the EURUSD stands at -1.48 as nearly 60% of traders are short. Yesterday, the ratio was at -1.45 as 59% of open positions were short. In detail, long positions are 1.9% higher than yesterday and 17.9% weaker since last week. Short positions are 4.0% higher than yesterday and 37.0% stronger since last week. Open interest is 3.1% stronger than yesterday and 12.4% above its monthly average. The SSI is a contrarian indicator and signals more EURUSD gains.

GBPUSD - The ratio of long to short positions in the GBPUSD stands at 1.25 as nearly 56% of traders are long. Yesterday, the ratio was at 1.22 as 55% of open positions were long. In detail, long positions are 0.2% higher than yesterday and 21.1% weaker since last week. Short positions are 2.1% lower than yesterday and 16.6% stronger since last week. Open interest is 0.8% weaker than yesterday and 10.2% below its monthly average. The SSI is a contrarian indicator and signals more GBPUSD losses.

GBPJPY - The ratio of long to short positions in the GBPJPY stands at 1.79 as nearly 64% of traders are long. Yesterday, the ratio was at 2.73 as 73% of open positions were long. In detail, long positions are 5.3% lower than yesterday and 3.1% stronger since last week. Short positions are 44.4% higher than yesterday and 55.5% stronger since last week. Open interest is 8.0% stronger than yesterday and 18.5% above its monthly average. The SSI is a contrarian indicator and signals more GBPJPY losses.

USDJPY - The ratio of long to short positions in the USDJPY stands at 3.04 as nearly 75% of traders are long. Yesterday, the ratio was at 3.00 as 75% of open positions were long. In detail, long positions are 0.7% higher than yesterday and 26.9% stronger since last week. Short positions are 0.6% lower than yesterday and 1.1% stronger since last week. Open interest is 0.4% stronger than yesterday and 11.8% above its monthly average. The SSI is a contrarian indicator and signals more USDJPY losses.

USDCAD - The ratio of long to short positions in the USDCAD stands at 3.22 as nearly 76% of traders are long. Yesterday, the ratio was at 2.37 as 70% of open positions were long. In detail, long positions are 13.6% higher than yesterday and 74.0% stronger since last week. Short positions are 16.5% lower than yesterday and 25.0% stronger since last week. Open interest is 4.6% stronger than yesterday and 13.3% above its monthly average. The SSI is a contrarian indicator and signals more USDCAD losses.

USDCHF - The ratio of long to short positions in the USDCHF stands at 1.47 as nearly 59% of traders are long. Yesterday, the ratio was at 1.83 as 65% of open positions were long. In detail, long positions are 4.2% lower than yesterday and 42.1% stronger since last week. Short positions are 19.6% higher than yesterday and 116.5% stronger since last week. Open interest is 4.2% stronger than yesterday and 2.1% above its monthly average. The SSI is a contrarian indicator and signals more USDCHF losses.

AUDUSD - The ratio of long to short positions in the AUDUSD stands at -1.57 as nearly 61% of traders are short. Yesterday, the ratio was at -1.55 as 61% of open positions were short. In detail, long positions are 1.5% higher than yesterday and 27.2% stronger since last week. Short positions are 2.5% higher than yesterday and 304.6% stronger since last week. Open interest is 2.1% stronger than yesterday and 2.8% above its monthly average. The SSI is a contrarian indicator and signals more AUDUSD gains.

NZDUSD - The ratio of long to short positions in the NZDUSD stands at 1.13 as nearly 53% of traders are long. Yesterday, the ratio was at 1.02 as 50% of open positions were long. In detail, long positions are 5.7% higher than yesterday and 38.3% stronger since last week. Short positions are 4.3% lower than yesterday and 97.0% stronger since last week. Open interest is 0.7% stronger than yesterday and 7.9% below its monthly average. The SSI is a contrarian indicator and signals more NZDUSD losses.
Nothing worth having is easy.
  • #345
  • Mar 3, 2010 8:40am Mar 3, 2010 8:40am
hi patience,
passed by this thread and read a little over the last week or so. have a few questions for you if you don't mind.
1. is this a daily report you have posted? when do they do it?
2. are these long term positions,ie..futures??
3. if i am reading their comments right, if the positions are more short, then the first currency of the pair will gain value, opposite for long?? right???
4. what time frame do you use this info in trading??

thanks for any comments.
  • #346
  • Mar 3, 2010 10:20am Mar 3, 2010 10:20am
G'day patience,

it's getting more interesting-
I managed to loaded up long E/U on weekly pp and still holding to long A/U-
did you look at that consolidation pattern- that I called it would be a pattern failure due to over crowding
look at this weekly U/cad - looks we may see a new low in U/cad soon-
if that happens - watch for a new high in A/U
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  • #347
  • Mar 3, 2010 10:24am Mar 3, 2010 10:24am
Hi mtrmth - I've typed my answers in blue for you.

hi patience,
passed by this thread and read a little over the last week or so. have a few questions for you if you don't mind.

1. is this a daily report you have posted? when do they do it?

The report is produced twice a day - mid-morning and then again in the evening.

2. are these long term positions,ie..futures??

Not to my knowledge. It's just the positioning of FXCM's retail traders in the market at the time of the report.

3. if i am reading their comments right, if the positions are more short, then the first currency of the pair will gain value, opposite for long?? right???

That's correct. You can also use it to gauge the sentiment on cross pairs e.g. traders are short AUD/USD indicating a long but long on USD/JPY indicating a short. That indicates to me that AUD/JPY will be quite static because it's evenly biased. Another example is that traders are short EUR/USD but long GBP/USD which indicates to me that EUR/GBP will probably gain in value.

4. what time frame do you use this info in trading??

All time frames but I use it as extra confirmation of my chart. I don't place trades based purely on the reading. The reading cannot take into account any unexpected announcements or news releases that happen during the day. For example, even though traders are long GBP/USD indicating a short the UK had a positive PMI Services release this morning which has resulted in a little rally.

Have you found it helpful or reasonably accurate since you have been reading it?

thanks for any comments.

You're welcome
Nothing worth having is easy.
  • #348
  • Mar 3, 2010 10:27am Mar 3, 2010 10:27am
Looks like we got a pattern failure aye Shahab
Nothing worth having is easy.
  • #349
  • Mar 3, 2010 10:28am Mar 3, 2010 10:28am
Quoting Patience
Looks like we got a pattern failure aye Shahab
just another observation
  • #350
  • Mar 3, 2010 10:34am Mar 3, 2010 10:34am
Quoting shahab8b
just another observation
Do you think the Department of Justice investigation put the wind up Soros' skirt? That move on EUR must have taken a few names .....

USDX 1 hour. Current value 79.85.

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Nothing worth having is easy.
  • #351
  • Mar 3, 2010 10:36am Mar 3, 2010 10:36am
short Gold opportunity
sell at 1153.75- 1157.75
reason:
1- fib 61%
2- strong R
3- Weekly R2
4-Good RRR
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  • #352
  • Mar 3, 2010 10:37am Mar 3, 2010 10:37am
Quoting Patience
Do you think the Department of Justice investigation put the wind up Soros' skirt? That move on EUR must have taken a few names .....

USDX 1 hour. Current value 79.85.

Attachment
what can they do with them?
  • #353
  • Mar 3, 2010 10:42am Mar 3, 2010 10:42am
Quoting shahab8b
what can they do with them?
According to Bloomberg, apparently it's not illegal to discuss shorting it but if they all agreed to short it at a particular price etc then that's illegal but it's going to be very hard to prove in a 3 trillion dollar a day market. That's why I think they have issued a "Do Not Destroy" order on paperwork/documents. Who knows.
Nothing worth having is easy.
  • #354
  • Mar 3, 2010 10:42am Mar 3, 2010 10:42am
hi patience. thanks for the answers. i just started reading this thread, so i am not fully versed on everything here as well as understanding everything just yet. i think i just need to re-read this a few times before it sinks in. i did notice how everything lost it's mind around 11am est. what was that??? unless the build in oil reserves shows how slow the u.s. economy is, maybe that was it. cuz it killed the report, everything went the opposite way.

well, i guess that is why it is called the beast!! always a lesson to be learned.
  • #355
  • Mar 3, 2010 10:50am Mar 3, 2010 10:50am
Quoting mtrmth
hi patience. thanks for the answers. i just started reading this thread, so i am not fully versed on everything here as well as understanding everything just yet. i think i just need to re-read this a few times before it sinks in. i did notice how everything lost it's mind around 11am est. what was that??? unless the build in oil reserves shows how slow the u.s. economy is, maybe that was it. cuz it killed the report, everything went the opposite way.

well, i guess that is why it is called the beast!! always a lesson to be learned.
You must be talking GBP/JPY? If I have assumed right, as I said, the UK had a good PMI Services report which has buoyed GBP and GBP crosses today.

But according to the report I posted earlier you should have been long EUR/USD, long AUD/USD, short USD/JPY, short USD/CHF, short USD/CAD, short NZD/USD (but this has gone long due to general USD weakness).

Hope this makes sense.
Nothing worth having is easy.
  • #356
  • Mar 3, 2010 10:51am Mar 3, 2010 10:51am
sell opportunity on A/U
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  • #357
  • Mar 3, 2010 10:54am Mar 3, 2010 10:54am
G/U short opportunity
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  • #358
  • Mar 3, 2010 11:17am Mar 3, 2010 11:17am
shabab, do you use just s/r levels and cot reports to trade?

i suppose all these are swing trades lasting days with maybe 100-200 pip s/l to allow breathing?

Quoting shahab8b
sell opportunity on A/U
  • #359
  • Mar 3, 2010 11:18am Mar 3, 2010 11:18am
patience, so basically extreme positioning on those charts make the pairs vulnerable to the reverse move?

is there any threshold beyond which positions start becoming extreme?

thks

Quoting Patience
You must be talking GBP/JPY? If I have assumed right, as I said, the UK had a good PMI Services report which has buoyed GBP and GBP crosses today.

But according to the report I posted earlier you should have been long EUR/USD, long AUD/USD, short USD/JPY, short USD/CHF, short USD/CAD, short NZD/USD (but this has gone long due to general USD weakness).

Hope this makes sense.
  • #360
  • Mar 3, 2010 11:43am Mar 3, 2010 11:43am
Quoting Patience
According to Bloomberg, apparently it's not illegal to discuss shorting it but if they all agreed to short it at a particular price etc then that's illegal but it's going to be very hard to prove in a 3 trillion dollar a day market. That's why I think they have issued a "Do Not Destroy" order on paperwork/documents. Who knows.
Yea, complete bollocks. A talking shop sharing ideas is OK, but hatching a plan isn't.

'Shall we talk gents?'
'Yes, let's'
'What do we all think about the Euro, pretty shit huh?'
'Oh yea, we all agree, pretty shit'

***winks all round***
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