You look for balanced position between non com and com section and confirmation in PA - to be precise, loosing momentum on Daily charts with weekly aproaching important support or resistance very often round psychological number - the whole combo should have a strong fundamental push as well, COT is a great tool to spot tops and bottoms in the main swings.
People say you shouldn't pick top & bottom probably because most do not know how to find them.
This technique is only for position traders which mean you hold even for few months, however non commercial section should be considered while trading swing - COT is irrelevant if you scalp for 10 pips a day
Good luck
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Joined Jun 2011
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Status: Keep It Simply Stupid
|356 Posts
Hi Tom,
In my 2 years experience using COT its been very useful and accurate I can tell if the bears or bulls are slowing down or speeding up. Just last 2-4 weeks GU shorts contracts are drying up meaning large traders are speculating long positions and only yesterday we seen the huge move on the UK GDP figures. We all know the large traders know the news and results before the release and position themselves by taking out the small guy and rocketing price.
