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Weekly COT report Analysis + Trade Ideas

  • #4,901
  • Dec 29, 2010 8:53am Dec 29, 2010 8:53am
[quote=beachallstar;4270711]
Quoting casperbet
Hi All,

I signed up for shahab8b's signal service and tried it out for 1 month.


Hey Shahab8b, don't worry about this guy. You are definitely one of the best traders on ForexFactory and everybody that reads your thread totally appreciates your clear and clean trading style. I also want to mention I think its really cool for you to take time explaining your reasoning behind your trades and answering questions, so anyone willing enough can learn to actually trade, rather than complain about a signal service that generates...
Hi beachallstar,
Thank you for your appreciation.I have mentioned this a couple of time that I really like everyone learn to trade that's the reason behind our efforts here.
  • #4,902
  • Dec 29, 2010 8:57am Dec 29, 2010 8:57am
Retest for quick pips.
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Hello.
  • #4,903
  • Dec 29, 2010 9:14am Dec 29, 2010 9:14am
Quoting Kaptain Ahab
hi shahab8b,
your thread is nothing less than 5 stars. thank you for sharing.
regarding indicator mt4_levelstop_reverse-v2.0, for EurUsd you use 9,3,1 settings, what would you recommend for UsdJpy?
rgds/kevin
Hi Kaptain Ahab,

Thanks for your kind comment.

Regarding your question, LSR might need different set up for different pairs.
The most important variable is ATR Multiplier, which I use 3 for E/U A/U. The creator of this custom indi suggested 2.85 so I guess it might be good for G/U and G/J.

Here is how I use it,

1-Set up Condition: look at larger TF like weekly or daily, if it's below price then Set UP Condition is Long if not it's Short.

2-Entry , if you use Weekly chart for Set Up you go with Daily or 4hr for entry. If you use Daily for Set up you go with 4Hr or 1Hr
for entry. When there is a cross of price and LSR in direction of your Set up Condition go with the signal.

3-SL is 10-20 pips below LSR on long trade or above that on short trade. Then you can move your SL when LSR changes

4-TP I use 3 times than my SL but I will manage my trade, like I exit when LSR on Entry TF changes or when I see RSI extreme reading on Entry TF.


Here is some illustration on EURCHF
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  • #4,904
  • Dec 29, 2010 9:21am Dec 29, 2010 9:21am
Quoting shahab8b
Hi Kaptain Ahab,

Thanks for your kind comment.

Regarding your question, LSR might need different set up for different pairs.
The most important variable is ATR Multiplier, which I use 3 for E/U A/U. The creator of this custom indi suggested 2.85 so I guess it might be good for G/U and G/J.

Here is how I use it,

1-Set up Condition: look at larger TF like weekly or daily, if it's below price then Set UP Condition is Long if not it's Short.

2-Entry , if you use Weekly chart for Set Up you go with Daily or 4hr for entry. If you use Daily for Set...
Another example on Cable
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  • #4,905
  • Dec 29, 2010 9:24am Dec 29, 2010 9:24am
Quoting shahab8b
Kiwi:
I've highlighted the levels that I usually look at. These days I often use my complex trading algorithm based on logistic regression modeling but sometime simple charting is as effective as complex models.
Kiwi : as expected.
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  • #4,906
  • Dec 29, 2010 9:31am Dec 29, 2010 9:31am
Quoting shahab8b
Kiwi : as expected.
If you have time can you briefly explain how the COT confirmed this trade ?

It looked to me like they have taken away the longs and added to the shorts for 2 weeks straight now.

Am I missing something ?

Thanks.
  • #4,907
  • Dec 29, 2010 10:05am Dec 29, 2010 10:05am
Hi Std Oil,

I cannot answer for Shahab, but here's my view on this subject.

Despite the fact that non-commercials reduced their longs in the latest report, they are still 17k to 10k long biased. That's still a strong long bias imho. Now that the wedge Shahab pointed out earlier has been broken to the upside, I wouldn't be surprised to see the next COT show a bigger non-commercial long bias than is now the case (although perhaps not significantly bigger, given that it's the holiday season).

But in short, 17k long vs 10k short is still almost 2:1 long biased.
It's not about how much you make, it's about how much you don't lose.
  • #4,908
  • Edited 1:05pm Dec 29, 2010 10:48am | Edited 1:05pm
Closed +45. Don't like to play with knives

Quoting emene
I know it might look insane to long euraud, but this could be a small chance to do so
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Hello.
  • #4,909
  • Dec 29, 2010 10:54am Dec 29, 2010 10:54am
Small TF. Inverted H&S confirmed. Enter at retest of neckline is opportunity offered.
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Hello.
  • #4,910
  • Edited 12:54pm Dec 29, 2010 10:57am | Edited 12:54pm
The simplicity of trading supports and resistances.



Quoting emene
Retest for quick pips.
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Hello.
  • #4,911
  • Dec 30, 2010 3:50am Dec 30, 2010 3:50am
Quoting Standard Oil
If you have time can you briefly explain how the COT confirmed this trade ?

It looked to me like they have taken away the longs and added to the shorts for 2 weeks straight now.

Am I missing something ?

Thanks.
c.o.t positioning does not tell you what price will do next. You cannot predict market direction or timing using these figures. It tells you what other traders have done, not what they are going to do next. This is useful but it is only one peice of information. Shahab does not take positions based on c.o.t alone. Traders react to price, not the other way around
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  • #4,912
  • Dec 30, 2010 7:03am Dec 30, 2010 7:03am
Quoting M.A.C.Doug
c.o.t positioning does not tell you what price will do next. You cannot predict market direction or timing using these figures. It tells you what other traders have done, not what they are going to do next. This is useful but it is only one peice of information. Shahab does not take positions based on c.o.t alone. Traders react to price, not the other way around

Yes but this thread is not about price action (which I am very comfortable with) its specifically about using the cot with price action, so I am just curious as to why with the kiwi he was trading against the non commercials.
  • #4,913
  • Dec 30, 2010 8:28am Dec 30, 2010 8:28am
NEW ZEALAND DOLLAR - CHICAGO MERCANTILE EXCHANGE Code-112741
FUTURES ONLY POSITIONS AS OF 12/21/10 |
--------------------------------------------------------------| NONREPORTABLE
NON-COMMERCIAL | COMMERCIAL | TOTAL | POSITIONS
--------------------------|-----------------|-----------------|-----------------
LONG | SHORT |SPREADS | LONG | SHORT | LONG | SHORT | LONG | SHORT
--------------------------------------------------------------------------------
(CONTRACTS OF NZD 100,000) OPEN INTEREST: 25,081
COMMITMENTS
17,780 10,414 0 5,150 13,326 22,930 23,740 2,151 1,341

CHANGES FROM 12/14/10 (CHANGE IN OPEN INTEREST: 571)
-3,534 1,621 0 4,165 -1,432 631 189 -60 382


u can see that long still more then short but have been reduced from last week and in same time short increased i believe those -353l4 closing some position or tp hit
GREENIUS
  • #4,914
  • Dec 30, 2010 10:29am Dec 30, 2010 10:29am
Aussie long,
Sl moved below S level to protect the profit. I am still bullish on Aussie.
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  • #4,915
  • Dec 30, 2010 10:47am Dec 30, 2010 10:47am
Quoting Standard Oil
Yes but this thread is not about price action (which I am very comfortable with) its specifically about using the cot with price action, so I am just curious as to why with the kiwi he was trading against the non commercials.
Hi Std Oil,

I have not been looking at Kiwi COt # but I have been watching closely Aussie COT #. These pairs have tendency to correlate closely, as you can see large institutes have been increasing their long positions on Aussie and that can be explained by PA too. For Kiwi, the biase is still Long so logically dip should be bought ,unfortunately I dont have the chart on Kiwi COT but you can tell besed on # on the COT website.Moreover, whenever I am want to decided between COT and PA I'll go with PA. If I'm not sure I skip that pair for a while till the pic becomes clear. That wedge on Kiwi was so typical for me, you can see that pattern over and over and long bias on commodity currencies on COT (Aussie, Loonie, Kiwi) solidified the long trade.
Attached Image
  • #4,916
  • Dec 30, 2010 11:12am Dec 30, 2010 11:12am
Quoting Arab
Hi everyone

what do you think about fib 38.2 retrace on U/J ?

And how was your xmas ?
Hi Arab,

Somehow I missed your post. When you posted your chart trend was down at hr/4hr/daily/weekly chart and the only logic to go counter trend could be a classic div on smaller TFs . If I were you I used a trend indicator and trade at the same direction. Take a look at the chart (the box is when you posted) we had fib 23 and a very clear S turned R around 84.50 also you can see LSR shows clear down trend , so we should be selling rallies in that scenario.
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  • #4,917
  • Dec 31, 2010 7:11am Dec 31, 2010 7:11am
Quoting shahab8b
Hi Std Oil,

I have not been looking at Kiwi COt # but I have been watching closely Aussie COT #. These pairs have tendency to correlate closely, as you can see large institutes have been increasing their long positions on Aussie and that can be explained by PA too. For Kiwi, the biase is still Long so logically dip should be bought ,unfortunately I dont have the chart on Kiwi COT but you can tell besed on # on the COT website.Moreover,...
Thank you for taking the TIME to explain that

I couldn't figure it out but it was a great call.
  • #4,918
  • Dec 31, 2010 11:49am Dec 31, 2010 11:49am
Quoting shahab8b
Aussie long,
Sl moved below S level to protect the profit. I am still bullish on Aussie.
Aussie long is just an example of how just a proper channel is more than enough to keep you at the right side of the market.SL has been moved accordingly
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  • #4,919
  • Dec 31, 2010 5:36pm Dec 31, 2010 5:36pm
Quoting Standard Oil
Yes but this thread is not about price action
I dont know how you can say this about this thread, It is mostly about price action and arguably one of the best price action threads on this forum.

You cant determine a bias based on a few contracts difference from the week to week c.o.t figures. There is no edge for your trading in making the non commercial positioning your only consideration as to directional bias.The C.O.T figures are a few days old when we get them. At the major price reversals, that is the end of the trend, the non commercials are always heavily positioned in the wrong direction, therefore there are times when it is in your best interests to fade them. They are just one piece of information to consider when making a decision. In this instance Shahab traded using price correlation with AUD and didnt even look at COT for NZD

C.O.T is a great tool and you can learn it free here, but it is not a holy grail
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  • #4,920
  • Jan 1, 2011 8:32am Jan 1, 2011 8:32am
Quoting M.A.C.Doug
I dont know how you can say this about this thread, It is mostly about price action and arguably one of the best price action threads on this forum.

You cant determine a bias based on a few contracts difference from the week to week c.o.t figures. There is no edge for your trading in making the non commercial positioning your only consideration as to directional bias.The C.O.T figures are a few days old when we get them. At the major price reversals, that is the end of the trend, the non commercials are always heavily positioned in the wrong...
Doug,

I've been trading price action for 25 years so I'm very comfortable with it.

I would have to disagree with you about the fact that a congruent add and minus from the COT is not an edge in itself.

Since following this thread I've seen it play out time after time but then again maybe I'm reading/trading it in a different way then others in here do.

For me it's all about the CONGRUENCY.

I take the Price Action set ups where the COT confirms my directional bias.

I was questioning the kiwi trade because it was counter the non commercials for the last few weeks, and therefore it did not meet my trade requirements.

There are 10 good Price Action threads out there on the web but this one adds an edge that the others can't.

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