How to read COT

In general, the data is presented in tables, COT graphs, charts, and COT charts to make analysis easier for traders. As a rule, the COT data is updated once a week (weekly COT Report), which allows traders to work with the most up-to-date information. This is especially important as market conditions can change in an instant. The larger the net short position of the small trader (relative to history) and the extent that small traders are holding a position “against” the trend are factors that will add to the bullishness of the report. MarketBulls provides you the latest Commitment of Traders report as well as a clean, understandable chart preparation, cot data tables and the historical data for each market for the COT report.

COMMITMENT OF TRADERS COT REPORTS RELEASE SCHEDULE *2024

It is a core data source for traders and for most academic research on pricing trends in the futures market. That said, it does have its critics and their issues with the report are justified. The biggest weakness with the COT is that, for a document meant to promote transparency, the rules governing it are not transparent. The report provides investors with up-to-date information on futures market operations and increases the transparency of these complex exchanges. The COT Public Reporting Environment (PRE) provides an application programming interface (API) to allow users to customize their experience with the COT market report data. The API allows users to search and filter across columns for each of the datasets, including reporting date or week, commodity groups, subgroups, or name, and contract market name.

Reports Dated December 17, 2024 – Current Disaggregated Reports:

Global market trends can be predicted even more accurately by looking at the positions of big players, such as those presented via the COT Report Commercials. Thanks to this information, traders can respond to emerging movements on time. Additionally, the data can be categorized by market participants, i.e., Commercials, Large Speculators, and Small Speculators, too. These filter options help traders conduct more precise analyses and develop specific strategies for each COT market. Large traders (funds) are typically trend-followers and will add or liquidate their positions depending on the technical action of the market since the release date of the report. The Open Interest represents the total number of contracts, including both buy and sell positions, outstanding between all market participants.

Spotting Trend Reversals

This provide us with the opportunity to pull this report weekly by using Web Query, one of the relateively unknown function in commitment of traders report forex Excel. While the COT report offers valuable insights, pairing it with technical indicators can improve decision-making. Indicators such as moving averages, Bollinger Bands, and the MACD (Moving Average Convergence Divergence) can help confirm signals from the COT data.

The report doesn’t present percentages of traders’ long or short positions but rather the number of contracts held. Large speculators, represented by the green line, typically follow trends for profit, while commercials (red line) hedge in futures markets, often against prevailing trends. The category called “dealer/intermediary,” for instance, represents sellside participants. Typically, these are dealers and intermediaries that earn commissions on selling financial products, capturing bid/offer spreads and otherwise accommodating clients. The remaining three categories (“asset manager/institutional;” “leveraged funds;” and “other reportables”) represent the buy-side participants.

1. CFTC staff does not know specific reasons for traders’ positions and hence this information does not factor in determining trader classifications.
2. In the 1990s, the report moved to a bi-weekly publication before going weekly in 2000.
3. The report will refresh the next time you open the file and pull the latest figure from the web.
4. By understanding which types of traders (such as commercials, speculators. etc.) hold large long or short positions, the traders reports can provide clues about potential future market movements.
5. Adam received his master’s in economics from The New School for Social Research and his Ph.D. from the University of Wisconsin-Madison in sociology.

Weekly Close Price represents the price action of the underlying currency pair. Calculating the percentage of speculativepositions that are long or short would be a better gauge to see whether themarket is topping or bottoming out. What you want to do is create an indexthat will help you gauge whether the markets are at extreme levels. Until a sentiment extreme occurs, itwould be best to go with the speculators. Hedgers are bearish when the market movesto the top while speculators are bullish when the price is climbing.

He currently researches and teaches economic sociology and the social studies of finance at the Hebrew University in Jerusalem. By watching the behavior of these players, you’ll be able to foresee incoming changes in market sentiment. For beginners, it’s an excellent way to get started on the right foot by providing a detailed analysis of your trading history and identifying patterns and areas for improvement. Advanced traders can use it to fine-tune their strategies and make better trades by having a complete overview of their performance.

Hedgers or commercial traders are thosewho want to protect themselves against unexpected price movements. The positions of the major market participants are graphically displayed in our COT tool. Here you can see the direction of the trade and receive the necessary COT signals. The COT report’s results can be used as a tool to give traders a better understanding of the psychology of the marketplace, the net position of the commercials in the market, and the net position of the large traders. This group of traders is generally thought to be small speculators and hedgers who are not holding a position large enough to report to the CFTC. The Commitment of Traders (COT) report is a weekly publication that shows the aggregate holdings of different participants in the U.S. futures market.

1. By understanding the average long and short positions over time, traders can identify when current positions are unusually high or low, potentially signaling an overbought or oversold market.
2. By reviewing the positions of commercial traders, who are often slower to adjust to market fluctuations but more aligned with economic fundamentals, traders can develop a strategy that captures the broader market direction.
3. The Legacy and Disaggregated reports are available in both a short and long format.
4. They help traders make adequate choices, reduce risks, and, hence, support both short-term and long-term strategies.
5. The Commitment of Traders COT Reports are based on data from the CFTC, including historical data, presented in an easy-to-read Excel Spreadsheet format.
6. These are like minimum requirements for a trader’s holdings to be included in the Commitments of Traders report.

The Asset Manager/ Intermediary Classification includes pension & mutual funds, endowments, insurance businesses and investment managers with mainly institutional customers. The Dealers may not mainly sell futures, but they design and sell different financial assets to their customers. Their business activities/ products are highly connected to the futures they buy and sell. The Dealer/ Intermediary Classification includes large local and international banks and dealers in different derivates. The legacy COT report separates reportable traders only into “commercial” and “non-commercial” categories.

Other Reportables contain all traders which are not categorized by the other classifications. That often includes central banks, smaller banks, credit unions and any other reported trader by the CFTC. For example, a trader with a bearish bias on a currency pair based on economic data might reconsider their position if the COT report indicates significant net long positions held by non-commercials.