Sunday 29 May 2011

COT basis May 24th, 2011

GOLD - as so often - provides little fresh guidance. Spreads, at 7.2% of total O/I, are increasing, perhaps showing increasing indecision; the share of O/I by category remains much as usual - Commercials 59.6%, Big Specs 31.3%, and Small Specs 9.1%. Total O/I increased, with Commercials adding shorts numerically, but not proportionately - their longs went down on both counts. All suggests UP, but not much.

Mini S&P - Commercials increased their nett long (now 8.2, from 5.0), mainly by cutting shorts. Big Specs moved to nett short (at -0.4, from plus 1.2), but have remained rather non-committal since mid-March. Small specs increased their nett short (at -7.8, from -6.2), and increased their share of total O/I (now at 13.0%), which suggests that any upmove from here could be sharp.

Currency positions continued to change sharply, but in the same direction as previously. Br Pounds showed Commercials moving to nett long, at +11.1 - only 4 weeks ago they were nett -43.2. Big Specs, on the other hand, added to nett shorts, at -12.9, while Small Specs came closer to neutral, at +1.8 (from +8.1). Their share of the total O/I is lower than usual, at 19.6% (vs Commercials at 48.5%, and Big Specs at 31.9%). Price direction looks up rather than down, especially once the Big Specs decide they're wrong to be short.

In EUROS also, positions have continued to move in the prior direction. Commercials are nett short 8.8 (from 20.8), Big Specs nett long (7.4, from 16.7), and Small Specs uncertain, at long 1.4 (from 4.1). Commercials are adding to longs, and reducing shorts, while Big Specs do the reverse - while this action continues, we'll go on bucking the price trend, and expect higher prices in due course.

Monday 23 May 2011

COT basis May 17th, 2011

Currencies demonstrate how long one might have to wait for Commercials' views to come right - for the last 3 weeks, Commercials have been adding to longs and cutting shorts, but values have been against them - so far, at least ...

In EUROS, spreads have continued to give little guidance, comprising only 0.5% of the total O/I for the last 2 weeks. But Commercials have moved from 23.8% of all longs 2 weeks ago, through 34.5% last week, to 42.5% most recently - the highest level since January. Their shorts, similarly, have moved from 71.5% through 67.5% to 63.2%, giving a nett of minus 20.8 - however, in January, they were nett long ...
Overall latest nett positions were: Commercials minus 20.8 (from minus 33.0), Big Specs plus 16.7 (from plus 25.4, and plus 38.0 the week before). Small Specs were plus 4.1 (from plus 7.6), with their share of the total O/I down to 19.4%, from a more normal 25% or so, which may be evidence of indecision. Commercials are usually right in the long run, but it can be a rough ride ....

BP total O/I continued to move higher, with Commercials adding to longs and reducing shorts, both overall and as a percentage. Their share of the total stood most recently at 40.8%, versus 28.4 and 20.5 in the 2 weeks before. Shorts were 48.0, versus 61.0 and 63.6, with their nett standing at minus 7.2 against minus 32.6 and minus 43.2; Big Specs reduced their proportionate longs, to 29.3 from 38.3 and 48.2, with shorts moving to 30.2 from 21.5 and 23.4. Small Specs also reduced their longs and added to shorts, netting out at plus 8.1, versus 15.8 and 18.3 in the previous 2 weeks. Same comment as Euros applies ...

I had said GOLD and S&P comments would follow - in fact, any changes are minimal, and give little fresh guidance ...