This post goes into an in depth analysis of the commitment of traders report and its usefulness for predicting price…
The commercial net positions are a mirror of the large trader net positions. Most of the time commercial net positions mirror the funds trading patterns but there are some important exceptions to this rule. In rare circumstances the commercials need to cover their positions and this can lead to significant price moves. These price moves can be predicted in advance by using the correct set of tools.
The COT Report is the single most important report issued by the CFTC revealing internal market dynamics. It’s some kind of sentiment indicator. The data collected on a weekly basis contains market positions of the largest futures traders. Let’s see how we can use the report to accurately predict market turns.