Weekly COT report Analysis + Trade Ideas

Thanks for the reply shahab8b...I understand what you say now...
Take care and keep posting your views on COT based trades as I mentioned earlier also, there are very few such threads.

Regards...

G/U
the net short positions on G/U increased during last week and COT index is bearish extreme- it warns of a correction higher but I guess any rally higher will be sold by big guns-I'm looking to short at higher level

E/U, shorts positions on E/U reduced a bit, but still seems crowded though. I expect some correction a bit higher

Written by Danske Bank Mar 08 10

Strong investor belief in a sustained dollar rally
The latest IMM data covers the week from 23 February to 2 March.
Following recent stabilisation in EUR/USD, speculative investors have trimmed short EUR positions marginally. However, at above 30% of open interest, EUR shorts remain an upside risk on EUR/USD.
Also in effective terms the dollar has lost momentum, as witnessed by the correction lower in the DXY index from its mid-February 81.342 high. As a result, speculative long USD positions have been trimmed to USD5.4bn.
The IMM report also reveals that speculative investors re-entered long JPY positions on a large scale in the week to 2 March – taking net longs to 24% of open interest. This indicates that the strong move lower in USD/JPY during late February – triggered by a correction lower in US interest rates – was at least partly driven by speculative flows. However, following strong US data, and dovish signals from the Bank of Japan, USD/JPY has corrected sharply higher from its 88.14 low, which could indicate the JPY longs have been unwound since the collection of IMM data.
The intensified pressure on GBP has seen short positions being extended from already crowded levels. Net short GBP positions have now reached 52% of open interest, leaving GBP/USD in particular at risk from a potential position squeeze, which could see the pair move sharply higher. However, while risks are skewed to upside from positioning, one should as always remember that even very crowded positioning can prove quite long-lived.

I try to figure out what's going on with E/U and USDX ,

for those interested to learn about this pattern
http://thepatternsite.com/descscallops.html

Open:short U/J from 90.50; Sl moved to B/E

Pending short A/U entry will be .9150-75 SL .9250

G'day Shahab

Yeah, I wasn't sure if it was just me being tired of trading or if it was all this chop. I think it's both.

SSI: Retail Long Positioning Jumps Across the Board, NZDUSD Ratio Flips
Tuesday, 09 Mar 2010 10:57 GMT
Written by Michael Wright, Daily FX Research

FXCM Speculative Sentiment Index (SSI) Statistics:




Intraday Highlight:

NZDUSD - The ratio of long to short positions in the NZDUSD stands at 1.04 as nearly 51% of traders are long. Yesterday, the ratio was at -1.19 as 54% of open positions were short. In detail, long positions are 16.2% higher than yesterday and 15.1% stronger since last week. Short positions are 6.0% lower than yesterday and 13.0% stronger since last week. Open interest is 4.1% stronger than yesterday and 7.7% above its monthly average. The SSI is a contrarian indicator and signals more NZDUSD losses

SSI Details:

EURUSD - The ratio of long to short positions in the EURUSD stands at 1.05 as nearly 51% of traders are long. Yesterday, the ratio was at -1.07 as 52% of open positions were short. In detail, long positions are 6.2% higher than yesterday and 27.3% stronger since last week. Short positions are 5.5% lower than yesterday and 16.1% weaker since last week. Open interest is 0.2% stronger than yesterday and 9.1% above its monthly average. The SSI is a contrarian indicator and signals more EURUSD losses.

GBPUSD - The ratio of long to short positions in the GBPUSD stands at 1.38 as nearly 58% of traders are long. Yesterday, the ratio was at 1.34 as 57% of open positions were long. In detail, long positions are 4.4% higher than yesterday and 14.2% stronger since last week. Short positions are 0.8% higher than yesterday and 0.7% stronger since last week. Open interest is 2.9% stronger than yesterday and 1.1% 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 1.84 as nearly 65% of traders are long. Yesterday, the ratio was at 1.54 as 61% of open positions were long. In detail, long positions are 2.6% higher than yesterday and 8.7% weaker since last week. Short positions are 14.1% lower than yesterday and 36.1% stronger since last week. Open interest is 4.0% weaker than yesterday and 9.5% 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 2.16 as nearly 68% of traders are long. Yesterday, the ratio was at 1.81 as 64% of open positions were long. In detail, long positions are 10.9% higher than yesterday and 10.9% weaker since last week. Short positions are 7.0% lower than yesterday and 23.9% stronger since last week. Open interest is 4.5% stronger than yesterday and 7.9% 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 4.67 as nearly 82% of traders are long. Yesterday, the ratio was at 3.97 as 80% of open positions were long. In detail, long positions are 1.4% higher than yesterday and 43.8% stronger since last week. Short positions are 13.9% lower than yesterday and 27.0% weaker since last week. Open interest is 1.7% weaker than yesterday and 27.0% 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 2.49 as nearly 71% of traders are long. Yesterday, the ratio was at 2.15 as 68% of open positions were long. In detail, long positions are 10.4% higher than yesterday and 77.2% stronger since last week. Short positions are 4.5% lower than yesterday and 30.2% stronger since last week. Open interest is 5.6% stronger than yesterday and 49.2% 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 -1.24 as nearly 55% of traders are short. Yesterday, the ratio was at -1.40 as 58% of open positions were short. In detail, long positions are 8.2% higher than yesterday and 17.2% stronger since last week. Short positions are 4.3% lower than yesterday and 6.8% weaker since last week. Open interest is 0.9% stronger than yesterday and 4.7% above its monthly average. The SSI is a contrarian indicator and signals more AUDUSD gains.

How to Interpret the SSI? The FXCM SSI is based on proprietary customer flow information and is designed to recognize price trend breaks and reversals in the four most popularly traded currency pairs. The absolute number of the ratio itself represents the amount by which longs exceed shorts or vice versa. For example if the EURUSD ratio is 2.55, long customer orders exceed short orders by a ratio of 2.55 to 1. Conceptually similar to contrarian analyses using the CFTC IMM open position data or COT Report, the SSI provides an alternative approach that is both more timely and accurate in forecasting currency price movement. The SSI is a contrarian indicator that tells you how the market is weighted and where the trend may head. More long positions don't necessary suggest more confidence in the direction of the current trend. In general, when traders start having adverse movements against their position, many tend to increase the size of their position with the purpose to average down their entry price in one last attempt to recover from previous losses. However, the higher the number of short orders in a bull market the more dangerous is to take additional shorts because many of those traders who just entered the markets are also leaving their protective stop losses just above the current price action.

I took Long Gold at 1112,
will switch to short at 1150-60 R zone

G'day Patience,
I think the same as you do, I need to see higher level on A/U /E/U and Gold and lower on U/C to be more confident to go long USD again
it seems the retailer bought U/cad on S level, I better re-consider my Long U/cad pending order

I think we will get the short entry on A/U soon
I will go short at .9150-70 R zone

Just pulled up a chart to have a look at it I can see the significance of this level on the weekly so clearly. Shucks. I guess there are a lot of stops around 1.02. Could get messy - he, he - I'm not touching it. Look at you with gold

SSI: Retail Positioning on USDCAD Tests a New Extreme as the Push to 1.02 Continues
Tuesday, 09 Mar 2010 19:00 GMT
Written by John Kicklighter

FXCM Speculative Sentiment Index (SSI) Statistics:



SSI Details:

EURUSD - The ratio of long to short positions in the EURUSD stands at 1.03 as nearly 51% of traders are long. Yesterday, the ratio was at -1.07 as 52% of open positions were short. In detail, long positions are 6.3% higher than yesterday and 27.4% stronger since last week. Short positions are 4.1% lower than yesterday and 14.9% weaker since last week. Open interest is 0.9% stronger than yesterday and 9.9% above its monthly average. The SSI is a contrarian indicator and signals more EURUSD losses.

GBPUSD - The ratio of long to short positions in the GBPUSD stands at 1.32 as nearly 57% of traders are long. Yesterday, the ratio was at 1.34 as 57% of open positions were long. In detail, long positions are 3.1% higher than yesterday and 12.8% stronger since last week. Short positions are 4.0% higher than yesterday and 3.9% stronger since last week. Open interest is 3.5% stronger than yesterday and 0.5% 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 1.69 as nearly 63% of traders are long. Yesterday, the ratio was at 1.54 as 61% of open positions were long. In detail, long positions are 4.9% higher than yesterday and 6.7% weaker since last week. Short positions are 4.6% lower than yesterday and 51.2% stronger since last week. Open interest is 1.1% stronger than yesterday and 15.0% 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 2.14 as nearly 68% of traders are long. Yesterday, the ratio was at 1.81 as 64% of open positions were long. In detail, long positions are 6.0% higher than yesterday and 14.8% weaker since last week. Short positions are 10.4% lower than yesterday and 19.4% stronger since last week. Open interest is 0.2% stronger than yesterday and 3.7% 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 5.43 as nearly 84% of traders are long. Yesterday, the ratio was at 3.97 as 80% of open positions were long. In detail, long positions are 12.1% higher than yesterday and 59.0% stronger since last week. Short positions are 18.1% lower than yesterday and 30.6% weaker since last week. Open interest is 6.0% stronger than yesterday and 36.4% 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 2.18 as nearly 69% of traders are long. Yesterday, the ratio was at 2.15 as 68% of open positions were long. In detail, long positions are 10.2% higher than yesterday and 76.9% stronger since last week. Short positions are 8.7% higher than yesterday and 48.3% stronger since last week. Open interest is 9.7% stronger than yesterday and 54.5% 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 -1.51 as nearly 60% of traders are short. Yesterday, the ratio was at -1.40 as 58% of open positions were short. In detail, long positions are 5.0% lower than yesterday and 3.0% stronger since last week. Short positions are 2.4% higher than yesterday and 0.2% weaker since last week. Open interest is 0.7% weaker than yesterday and 3.2% 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 -1.00 as nearly 50% of traders are short. Yesterday, the ratio was at -1.19 as 54% of open positions were short. In detail, long positions are 5.7% higher than yesterday and 4.7% stronger since last week. Short positions are 11.2% lower than yesterday and 6.7% stronger since last week. Open interest is 3.5% weaker than yesterday and 0.2% above its monthly average. The SSI is a contrarian indicator and signals more NZDUSD gains.

As you said ,I'm sure there are lots of Stops on 1.02 but the buying pressure is huge here- did you look at my triangle on U/Cad weekly, it could be a continuation or a reversal , if the 1.02 holds, there is a case for a triple bottom.
and for Gold, +100 pips so far
wow, look at your SSI U/Cad !!!! I'm along side them !!! what a move if 1.02 breaks!!!

Morning Shahab

I did see your triangle. I haven't chucked a soldier out there yet. I like to have Jurik confirmation on (at least) my 1 hour chart although there's bullish divergence on 4 hour but it's down on daily, weekly and monthly.

Just seen this article. My trading is so rare at the moment that on a couple of accounts my interest earned on holding A/J positions is more than my trading profits. Ha, ha, ha. Now I don't feel so bad after reading this article

Hedge-Fund Losses Show Euro’s Drop Fails to Benefit All Traders

March 10 (Bloomberg) -- Hedge funds that trade currencies are taking hits from politicians casting them as speculators out to sink the euro and push Greece into insolvency. They are also losing money.

Macro funds, so named because they try to profit from macroeconomic trends, fell 1 percent in the first two months of the year, according to data compiled by Chicago-based Hedge Fund Research Inc. Brevan Howard Asset Management LLC, Europe’s largest hedge-fund firm, Moore Capital Management LLC and Tudor Investment Corp. were among those reporting fund losses.

http://www.bloomberg.com/apps/news?p...og9.3rQU&pos=7

G'day patience,
the triangle is tricky, I'm unsure of the outcome. I took the trade just considering the RRR , at least I know where I should close them.
interesting article, investment is not easy these days

hi Shahab
do you remember these two setup?
finally it worked out
i still follow your great thread.thank you

AUDUSD1440

http://www.forexrainbow.com/files/ro...x6qs_thumb.jpg

XAUUSD1440

http://www.forexrainbow.com/files/15...t90c_thumb.jpg

Good Luck

Makes you wonder who made all the money shorting the E/U. So you put your money with the biggest hedge fund in Europe and they turn around and say, uh, sorry, your investment lost 1% in Jan/Feb.

SSI: Retail NZDUSD Shorts Jump 15% Following RBNZ Interest Rate Decision
Thursday, 11 Mar 2010 10:33 GMT
Written by Michael Wright, Daily FX Research

FXCM Speculative Sentiment Index (SSI) Statistics:




Intraday Highlight:

NZDUSD - The ratio of long to short positions in the NZDUSD stands at -1.06 as nearly 51% of traders are short. Yesterday, the ratio was at 1.08 as 52% of open positions were long. In detail, long positions are 0.8% higher than yesterday and 6.3% weaker since last week. Short positions are 14.7% higher than yesterday and 33.8% stronger since last week. Open interest is 7.5% stronger than yesterday and 15.5% above its monthly average. The SSI is a contrarian indicator and signals more NZDUSD gains.

SSI Details:

EURUSD - The ratio of long to short positions in the EURUSD stands at -1.19 as nearly 54% of traders are short. Yesterday, the ratio was at -1.31 as 57% of open positions were short. In detail, long positions are 9.9% higher than yesterday and 6.8% weaker since last week. Short positions are 0.2% lower than yesterday and 26.0% stronger since last week. Open interest is 4.2% stronger than yesterday and 18.7% 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 1.11 as nearly 53% of traders are long. Yesterday, the ratio was at 1.19 as 54% of open positions were long. In detail, long positions are 3.5% higher than yesterday and 4.4% stronger since last week. Short positions are 11.2% higher than yesterday and 15.5% stronger since last week. Open interest is 7.0% stronger than yesterday and 7.1% above 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 1.64 as nearly 62% of traders are long. Yesterday, the ratio was at 1.48 as 60% of open positions were long. In detail, long positions are 7.0% higher than yesterday and 6.4% weaker since last week. Short positions are 3.7% lower than yesterday and 36.1% stronger since last week. Open interest is 2.7% stronger than yesterday and 14.8% 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 1.73 as nearly 63% of traders are long. Yesterday, the ratio was at 1.71 as 63% of open positions were long. In detail, long positions are 2.3% higher than yesterday and 22.0% weaker since last week. Short positions are 0.9% higher than yesterday and 12.6% stronger since last week. Open interest is 1.8% stronger than yesterday and 1.0% below 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 3.71 as nearly 79% of traders are long. Yesterday, the ratio was at 3.70 as 79% of open positions were long. In detail, long positions are 3.4% lower than yesterday and 15.7% stronger since last week. Short positions are 3.5% lower than yesterday and 4.6% stronger since last week. Open interest is 3.4% weaker than yesterday and 30.6% 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 3.25 as nearly 76% of traders are long. Yesterday, the ratio was at 3.21 as 76% of open positions were long. In detail, long positions are 6.5% higher than yesterday and 136.2% stronger since last week. Short positions are 5.0% higher than yesterday and 0.2% stronger since last week. Open interest is 6.1% stronger than yesterday and 64.3% 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 -1.58 as nearly 61% of traders are short. Yesterday, the ratio was at -1.58 as 61% of open positions were short. In detail, long positions are 3.8% higher than yesterday and 5.7% weaker since last week. Short positions are 3.9% higher than yesterday and 38.7% stronger since last week. Open interest is 3.9% stronger than yesterday and 11.7% above its monthly average. The SSI is a contrarian indicator and signals more AUDUSD gains.

G'day Shahab

Another fairly lacklustre day or maybe it's just me. Those indices just don't want to sell off do they. I keep expecting it to happen and it just doesn't materialise. Interesting to see that Marty Feldstein, a noted economist who doesn't really like the Euro has said today that the Euro sell-off was an overreaction to Greece http://www.bloomberg.com/apps/news?p...d=azk6ltccpXsc I threw a few soldiers out there on USD/CAD, scalped a little and have some still sitting there because it's gone back down again - doh! Looks like sentiment will flip soon on Cable if it goes up any further ....

SSI: GBPUSD Shorts Jump 10% Despite the First Rebound in Four Days
Thursday, 11 Mar 2010 19:20 GMT
Written by John Kicklighter

FXCM Speculative Sentiment Index (SSI) Statistics:



Intraday Highlight:

GBPUSD - The ratio of long to short positions in the GBPUSD stands at 1.06 as nearly 51% of traders are long. Yesterday, the ratio was at 1.19 as 54% of open positions were long. In detail, long positions are 2.8% lower than yesterday and 2.0% weaker since last week. Short positions are 9.8% higher than yesterday and 14.1% stronger since last week. Open interest is 3.0% stronger than yesterday and 3.3% above its monthly average. The SSI is a contrarian indicator and signals more GBPUSD losses.

SSI Details:

EURUSD - The ratio of long to short positions in the EURUSD stands at -1.37 as nearly 58% of traders are short. Yesterday, the ratio was at -1.31 as 57% of open positions were short. In detail, long positions are 3.5% higher than yesterday and 12.3% weaker since last week. Short positions are 7.7% higher than yesterday and 36.0% stronger since last week. Open interest is 5.9% stronger than yesterday and 20.6% above its monthly average. The SSI is a contrarian indicator and signals more EURUSD gains.

GBPJPY - The ratio of long to short positions in the GBPJPY stands at 1.47 as nearly 60% of traders are long. Yesterday, the ratio was at 1.48 as 60% of open positions were long. In detail, long positions are 4.5% higher than yesterday and 8.6% weaker since last week. Short positions are 4.8% higher than yesterday and 48.2% stronger since last week. Open interest is 4.6% stronger than yesterday and 16.8% 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 1.61 as nearly 62% of traders are long. Yesterday, the ratio was at 1.71 as 63% of open positions were long. In detail, long positions are 0.0% lower than yesterday and 23.8% weaker since last week. Short positions are 6.4% higher than yesterday and 18.7% stronger since last week. Open interest is 2.4% stronger than yesterday and 0.5% below 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 3.93 as nearly 80% of traders are long. Yesterday, the ratio was at 3.70 as 79% of open positions were long. In detail, long positions are 2.8% lower than yesterday and 16.4% stronger since last week. Short positions are 8.4% lower than yesterday and 0.7% weaker since last week. Open interest is 4.0% weaker than yesterday and 29.9% 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 3.47 as nearly 78% of traders are long. Yesterday, the ratio was at 3.21 as 76% of open positions were long. In detail, long positions are 9.5% higher than yesterday and 143.1% stronger since last week. Short positions are 1.3% higher than yesterday and 3.4% weaker since last week. Open interest is 7.6% stronger than yesterday and 66.4% 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 -1.54 as nearly 61% of traders are short. Yesterday, the ratio was at -1.58 as 61% of open positions were short. In detail, long positions are 1.9% lower than yesterday and 10.9% weaker since last week. Short positions are 4.0% lower than yesterday and 28.1% stronger since last week. Open interest is 3.2% weaker than yesterday and 4.5% 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 1.03 as nearly 51% of traders are long. Yesterday, the ratio was at 1.08 as 52% of open positions were long. In detail, long positions are 4.4% lower than yesterday and 11.2% weaker since last week. Short positions are 0.4% higher than yesterday and 17.2% stronger since last week. Open interest is 2.1% weaker than yesterday and 5.7% above its monthly average. The SSI is a contrarian indicator and signals more NZDUSD losses.

G/J
there is a near perfect trade set up for G/J
Pending Sell limit order at 138.30 ,SL=140.30 ,1stTP=136.30 2ndTP=TBD

reason for trade:
1-S turns R
2-Weekly R1 at 138.43
3-Monthly Pivot at the same level
4-38% fib level
5-50% fib fan

Hi Patience,
today wasn't easy for me too, I had some losers today ,for U/Cad the S line is heavily under pressure , I'm really started questioning the possibility of a reversal here, price usually doesn't like S/R line ,when it's hanging around them like this one ,the chance of a break out is increasing, but I'm still buying U/Cad due to good RRR in case of a reversal.

took long gold at 1108, SL=1100 TP=1155
I will switch to short at 1155