AUTOREFRESH 
Looking at COT data
By Jamie Coleman || July 13, 2010 at 17:47 GMT
|| 5 comments || Add comment
Here’s a little tutorial for looking at the Commitment of Traders reports published each Friday by the CFTC.
In forex, ignore the “commercial” category (the categories the CFTC use are more appropriate for physical commodities like agricultural goods, rather than financial futures…) on the table and concentrate on the “non-commercial” or speculative category. To find the market’s overall position, simply net together the long and the shorts. The data released last Friday, as of the end of business July 6, shows the market was net short a total of 38.909 contracts, a big decline over the prior week.
Thanks Jamie,
Related to my previous post here are some follow on question I have.
I have quoted the numbers from the Bank Particaption report for July also and want to confirm how it ties in with the CoT report.
i) My understanding is that the numbers quoted in the bank participation report are a subset of those within the CoT report. ( based on the fact the open interest quoted is the same for both )
ii) The banks are classified as commercial in the CoT report.
( I know the one you advised to ignore but just want to know where they fit )
iii) When a contract is quoted as Long Euro fx it does indeed mean Long Euro relative to USD ( and not Long USD relative to Euro ).
Those questions, particularly, the last may seem so basic as almost insulting, but when you have the time would appreciate confirmation of these points.
Again, I want to say that I follow most articles and posts on this site and have a lot of respect for you, the team and many of the posters. You have helped me out many times.
Cheers, Paul
— manual extract of the bank futures participation report as for July 6th —-
Banks Long futures Short Futures
07/06/10 CME EURO FX US 5 62706 1217
Non US 13 9939 1316
Total 18 72645 2533
Total Open Interest : 228333
(i) and (ii) I have no idea…there is no compelling reason for banks to trade futures rather than cash, so it is pretty meaningless….
Some investors prefer the safety of a clearinghouse from a credit perspective…that is the only compelling advantage a futures contract over a cash contract…years ago, retail investors only had access to futures, not cash. These days every one has access to everything.
If you are long a euro FX contract, you are short the US dollar…
Don’t obsess too much over the COT data…they are one piece of a very large puzzle…
Cheers Jamie,
Thanks and agreed – I’m still at the stage of counting the pieces!
Good luck in your trades,
Paul
Hi Jamie whats your call on aud/usd do you think shorting it over here would be fine or should wait for.8900
Risk on..matey…why be short at all?