COT: Speculators Capitulate on the Dow and U.S. Bonds

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 report includes observations on the Dow, U.S. Bonds, Heating Oil, Wheat, Soybean Meal, and Lean Hogs.

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  • Look for a low in U.S. bonds
  • Heating Oil is attractive on this dip
  • Lean hogs sold out?

52 Week Ownership Profile Extremes – Dow, Nasdaq, Eurodollar, Soybean Meal

13 Week Volume Highs – Soybean Meal

Currencies Indexes Interest Rates Metals 
US Dollar100S&P 5004930 Yr US Bond0Gold2
Euro10NASDAQ 1008810 Year US Note6Silver2
British Pound8Dow595 Year US Note4Copper0
Swiss Franc35Nikkei222 Year US Note28Platinum16
Japanese Yen59Eurodollar47
Canadian Dollar16
Australian Dollar10
New Zealand Dollar20
Mexican Peso12
Energies Agriculture Meats Softs 
Crude Oil18Wheat84Lean Hogs43Coffee2
Heating Oil43Hard Red Winter Wheat77Live Cattle37Cotton31
RBOB Gas80Corn43Feeder Cattle12Frozen OJ59
Natural Gas67Oats24Cocoa41
Soybeans4Sugar28
Soybean Oil0
Soybean Meal31
Rough Rice2

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 February 13th, 2018

Non Commercials (speculators) – Red

Commercials – Blue

Small Speculators – Black

COTDiff (COT Index) – Black

52 week Percentile (COT Diff) – Gray

Dow CBOT Continuous Contract

The 1 and 4 week changes in Dow positions is extreme (speculators selling and commercials buying).  The extreme reading is consistent with conditions seen near a price low or a pause within a downtrend.

30 Yr U.S. Treasury Bond CBOT Continuous Contract

The 4 week change in U.S. Bond positions is extreme (speculators selling and commercials buying).  The extreme reading is consistent with conditions seen near a price low or a pause within a downtrend.

Heating Oil NYMEX Continuous Contract

The 1 and 4 week changes in Heating Oil positions is extreme (speculators selling and commercials buying).  The extreme reading is consistent with conditions seen near a price low or a pause within a downtrend.

Wheat CBOT Continuous Contract

The 4 week change in Wheat positions is extreme (speculators buying and commercials selling).  The extreme reading is consistent with conditions seen near a price high or a pause within an uptrend.

Soybean Meal CBOT Continuous Contract

The Soybean Meal ownership profile has reached a record.  A record ownership profile with speculators long and commercials short warns of a price high.

Lean Hogs CME Continuous Contract

The 1 and 4 week changes in Lean Hogs positions is extreme (speculators selling and commercials buying).  The extreme reading is consistent with conditions seen near a price low or a pause within a downtrend.