Saturday, February 12, 2011

COT Report Week Ending 2/8

Not a whole lot of conclusions to be drawn from this week's COT report. The commercial positions for Oil and SPX Consolidated are showing a pretty large divergence. Additionally commercial traders look more positioned for treasury strength (lower yield) in the coming week(s).  Beyond that though, the charts speak for themselves.

Commercial positions reversed and are trending more short as copper continues to catch a bid.  It will be interesting to see if their position reverses as it approaches a prior high or continues signaling more copper strength.

Pretty interesting chart here.  Commercial positions continue to trend more net short even while oil fell in price after Egypt settled down.  This data is for Nymex and not Brent crude.  Looks like oil though is due for a decent move up in the coming week(s) at least that is how commercial traders are positioned.

I'm not well versed on this chart.  What caught my eye though was the divergence the past few weeks and especially this most recent week.  Commercial positions have trended to a far more neutral position.  The commercial position is somewhat correlated with the SPX but in the past year has not seen such a divergence.  

This is a rather confusing chart.  The first half of 2010 for the most part there was a direct correlation but since then the two have inversely correlated.  The only note to make is that the divergence is wider than it has been and the commercial position has not been this net long before.  Two equally compelling conclusions can be drawn here.  

Long Bond:
As the 30 year continues to sell off in price, commercial positions have begun to turn slightly net short while the divergence between price and their position is rather large. This would imply pending treasury strength (lower yields) at least in the long end of the curve.  


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