COT: Specs Get Whipsawed in Silver Market

The COT report is published each week and includes observations on charts of markets that exhibit interesting ownership characteristics and/or changes in ownership characteristics. This week’s update includes observations on Silver and Soybean Meal.

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  • Extreme spec selling last week in silver
  • Position extremes across the Treasury curve
  • Soybean meal position extreme and 1 week capitulation

52 Week Ownership Profile Extremes – S&P 500, 30 yr. U.S. T-Bond, 5 yr. U.S. T-Note, Oats, Soybean Oil, Soybean Meal, Lean Hogs, Live Cattle, Feeder Cattle

13 Week Volume Highs – None

Currencies Indexes Interest Rates Metals 
US Dollar69S&P 5009830 Yr US Bond6Gold8
Euro61NASDAQ 1001410 Year US Note6Silver16
British Pound45Dow65 Year US Note2Copper49
Swiss Franc0Nikkei882 Year US Note94Platinum4
Japanese Yen92Eurodollar22
Canadian Dollar26
Australian Dollar0
New Zealand Dollar39
Mexican Peso10
Energies Agriculture Meats Softs 
Crude Oil65Wheat90Lean Hogs0Coffee43
Heating Oil55Hard Red Winter Wheat80Live Cattle0Cotton94
RBOB Gas100Corn94Feeder Cattle4Frozen OJ100
Natural Gas39Oats0Cocoa100
Soybeans80Sugar29
Soybean Oil6
Soybean Meal96
Rough Rice75

The COT Index is the difference between net speculative positioning and net commercial positioning measured over a 52 week percentile.  A reading of 100 indicates that the difference in positioning is the greatest it has been in 52 weeks with speculators buying and commercials selling.  A reading of 0 indicates that the difference in positioning is the greatest it has been in 52 weeks with speculators selling and commercials buying.  Speculators tend to be on the wrong side at the turn and commercials the correct side.  Use of the index is covered closely in detail in my book.

Latest CFTC Release dated May 1st, 2018

Non Commercials (speculators) – Red

Commercials – Blue

Small Speculators – Black

COTDiff (COT Index) – Black

52 week Percentile (COT Diff) – Gray

Silver COMEX Continuous Contract

The 1 week change in silver positions (top red line) is considered extreme with speculators selling and commercials buying.  Larger 1 week changes are indicated by blue dots.  Many of the instances occurred near price lows.

Soybean Meal CBOT Continuous Contract

The net speculative long position in Soybean Meal is a record.  The ownership profile has been ‘extreme’ for an extended period of time but now the 1 week change in positions (see chart below) is also extreme.  In fact, the only larger 1 week change in positions (speculators buying and commercials selling) occurred the week that ended 1/20/2017.  That marked an important top.

Soybean Meal CBOT Continuous Contract