Disliked{quote} Hi D, you are correct. I have been watching COT for some time, and added it to my toolbox. However, I have found the time frame you trade effects this all as well, as the COT is more a tool for someone swing or position trading (comes out once a week)- than shortterm traders.. (I do both- so find COT useful- like you mentioned.) I think Babypips was the first place I started reading about COT reports for anyone interested.. non comms are the big trend riders, and comms are big contrarions awaiting reversals.. so to speak. I...Ignored
Non-commercials are mostly traders & hedge funds (speculators) & commercials are large banks/financial institutions, and producers/processors of commodities. A gold mining company would be a commercial as they produce the product so use futures to hedge their production. FF traders are a small part of non-commercials as we're speculating on the price of a market. Large banks/financial institutions can be under either category depending upon their reason for trading/hedging. They might be hedging for their customers or they might be just speculating on the price movement.
When you say "comms are big contrarians awaiting reversals", it may appear that way but they're usually taking advantage of extremes in price. Oil producers might be adding more & more shorts as price goes higher as they feel price is good for them to lock in profits for part of production. The reason many like to watch the commercials is because they usually have the best "inside information" as they know their industry better than anyone. If insiders are selling, is price maybe getting too high?
Link to COT report from July 1 (http://www.cftc.gov/dea/futures/financial_lf.htm) showing all currency futures.
