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 Dollar100S&P 5006530 Yr US Bond2Gold0
Euro0NASDAQ 1008010 Year US Note2Silver28
British Pound0Dow495 Year US Note0Copper0
Swiss Franc2Nikkei182 Year US Note65Platinum4
Japanese Yen59Eurodollar47
Canadian Dollar20
Australian Dollar0
New Zealand Dollar6
Mexican Peso24
Energies Agriculture Meats Softs 
Crude Oil45Wheat100Lean Hogs0Coffee0
Heating Oil35Hard Red Winter Wheat92Live Cattle37Cotton82
RBOB Gas96Corn59Feeder Cattle20Frozen OJ94
Natural Gas26Oats28Cocoa41
Soybeans14Sugar37
Soybean Oil2
Soybean Meal47
Rough Rice78

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