Latest Commitment of Traders report.

Commitment of Traders: Professionals -2.2% (short)

Bear in mind that the Commitment of Traders data is collected at the close on Tuesday, therefore, before the large sell-off we saw on Thursday. The Large contract (SP) professionals had increased their short positions from -0.3% to -2.2% of total open interest at the beginning of last week. This was the largest move we’ve seen in the COT data for about 2 months. Pity the data gets delayed!

Commitment of Traders: Oscillator -50

The Commitment of Traders Oscillator also dropped from +105 to -50. So the over-bought reading we’ve had over the last 3 weeks has turned out to be correct. We’re now down at -50 which is in "no man’s land" and we’ll have to wait for this week’s Emini trading for more signals.

Remember, the Commitment of Traders data is collected weekly after the close on Tuesday and the Commitment of Traders Report is published after the close on Friday.

Commitment of Traders Oscillator still over-bought at +105 this week.

Commitment of Traders: Professionals -0.3% (short)

Very little new insight from this week’s Commitment of Traders Report. Large (SP) contract professionals continued to be marginally short this week at -0.3% of total open interest, up fractionally from last week.

Large (SP) contract professionals and mini (ES) contract professionals are closely aligned with the percentage difference between them only -0.2% (red line above).

Commitment of Traders: Oscillator +105

The Commitment of Traders Oscillator ticked over this week from +106 to +105 and is still over-bought.

This week’s Emini trading resulted in an inside weekly bar and doji candlestick pattern, indicating indecision. We have support at 1,260 and resistance at 1,300 – so look for any breaks of these levels next week.

Despite the over-bought COT Oscillator I’m still medium-term bullish:

• Low volume down bar on weekly Emini chart
• Cyclical Hilbert Sine Wave lows on daily and weekly Emini charts
• Bonds in an uptrend from 20 days ago
• US Dollar in an uptrend again Japanese Yen

Remember, the Commitment of Traders data is collected weekly after the close on Tuesday and the Commitment of Traders Report is published after the close on Friday.

Commitment of Traders Oscillator reaches +106 and over-bought this week.

Commitment of Traders: Professionals -0.7% (short)

The large (SP) contract professionals continued to be marginally short this week. The Commitment of  Traders reading was -0.7% (short) of total open interest, down fractionally from last week.

The Commitment of Traders reading and the difference between large (SP) contract professionals and mini (ES) contract professionals (red line on the chart above) have been hovering at the same levels for almost 6 weeks now.

Commitment of Traders: Oscillator +106

The Commitment of Traders Oscillator rose to +106 this week and is now over bought. The Emini has found it difficult to break 1,300 over the last couple of weeks and has lacked sufficient volume to "jump the creek". The Commitment of Traders Oscillator suggests the momentum should switch to the downside.

Remember, the Commitment of Traders data is collected weekly after the close on Tuesday and the Commitment of Traders Report is published after the close on Friday.

Commitment of Traders data weakens this week.

Commitment of Traders: Professionals -0.5% (short)

The large (SP) contract professionals reversed and went net short this week. The Commitment of  Traders reading was -0.5% (short) of total open interest, down from +0.7% (long) last week.

The red line in the chart above represents the difference between large (SP) contract professionals and mini (ES) contract professionals. The red line dipped this week to -0.2, showing the large and mini contract professionals are closely aligned.

Commitment of Traders: Oscillator +67

The Commitment of Traders Oscillator crossed the zero line and ended at +67 this week. This confirms the last swing low at 1,200 made 4 weeks ago. We’ve got:

• Hilbert Sine Wave cyclical tops on daily, 81 and 135 minute charts
• Potential bearish divergence pattern on the adjusted TRIN
• Emini is over-extended after Friday’s buying surge, and
• Down turn in the Bond market around 20 days ago

I wouldn’t be surprised to see some profit taking this week around the 1,300 level.

Remember, the Commitment of Traders data is collected weekly after the close on Tuesday and the Commitment of Traders Report is published after the close on Friday.

Commitment of Traders crosses zero line this week.

Commitment of Traders: Professionals +0.7% (long)

The large (SP) contract professionals held net long positions this week. The Commitment of  Traders reading was +0.7% of total open interest, up from -0.4% (short) last week.

The red line in the chart above represents the difference between large (SP) contract professionals and mini (ES) contract professionals. The red line continued to rise this week and the gap between the large and mini contract professionals widened. This is bullish for equities.

Commitment of Traders: Oscillator -82

The Commitment of Traders Oscillator completed it’s double bottom pattern this week and rose from -117 to -82. Patterns like this on the Oscillator have been bullish in the past.

This week’s action came close to being a Long-Legged Doji candlestick pattern, indicating indecision and lack of strong direction. We’re also approaching a Pull Back pattern on the daily Hilbert Sine Wave and could see a down leg this week. However, the Commitment of Traders analysis is bullish and so my best guess is the market will recover from any weakness.

Remember, the Commitment of Traders data is collected weekly after the close on Tuesday and the Commitment of Traders Report is published after the close on Friday.

Commitment of Traders charts turning bullish this week.

Commitment of Traders: Professionals -0.4% (short)

The large (SP) contract professionals continued reducing their short positions. This week’s reading is -0.4% of total open interest, up from -1.2% last week.

Commitment of Traders: Oscillator -117

The Commitment of Traders Oscillator looks like it’s making a double bottom pattern. The Oscillator reading is -117, down from -66 last week.

Last week I said this Oscillator pattern suggested we would re-test the 1,200 level. On Monday we reached a low of 1,233 but on lower volume than the last sell off. If the volume on down days continues to be light then this would indicate a successful test and another bullish phase for the market.

Remember, the Commitment of Traders data is collected weekly after the close on Tuesday and the Commitment of Traders Report is published after the close on Friday.

Analysis of the latest Commitment of Traders Report:

Commitment of Traders: Professionals -1.2% (short)

The large (SP) contract professionals have been reducing their short positions over the last couple of weeks. This weeks reading is -1.2% of total open interest, up from the -3.2% level reached 2 weeks ago.

By contrast, the mini (ES) contract professionals have been increasing their short positions and so the difference between the large and mini contract professionals has been increasing (red line in the chart above). The large contract professionals have historically been a better indicator of future market direction than the mini contract professionals.

Commitment of Traders: Oscillator -66

The Commitment of Traders Oscillator turned down this week from -38 to -66. This Oscillator pattern can be seen at previous significant lows and suggests that the Emini will re-test the 1,200 level before we start another bullish phase in the market. The Commitment of Traders Oscillator is a longer term Emini indicator and designed to highlight broad trends.

Remember, the Commitment of Traders data is collected weekly after the close on Tuesday and the Commitment of Traders Report is published after the close on Friday.

Latest Commitment of Traders charts:

Commitment of Traders: Professionals -1.8% (short)

The large (SP) contract professionals reversed their net position this week from long to short. The drop was from +4.9% of total open interest to -1.8%.

By contrast, the mini (ES) contract professionals increased their long positions to +7.0% of open interest. I have shown both data sets on the chart above.

The back testing that I’ve done shows that the large contract professionals are a better indicator of future market direction than the mini contract professionals.

Commitment of Traders: Oscillator -74

The Commitment of Traders Oscillator has turned up this week and gone from -122 to -74. The Emini is at critical support (1,260 to 1,280) and it’s quite possible that we’ll get a bounce or short covering rally this week.

However, the strength of the market is clearly in doubt with this week’s sharp drop in the professional’s outlook. Good luck with your Emini trading.

Remember, the Commitment of Traders data is collected weekly after the close on Tuesday and the Commitment of Traders Report is published after the close on Friday.

Commitment of Traders latest charts

Commitment of Traders: Professionals +4.9% (long)

Small drop in the professionals’ long positions from 5.4% to 4.9% of total open interest. Remember this is measuring the Large SP contract professionals.

The difference between the Large and Mini contract professionals has also widened. The red line in the chart above is rising, which indicates that the Large contract professionals (the "true" professionals) are becoming more bullish than the Mini contract professionals.

Commitment of Traders: Oscillator -122

The Commitment of Traders Oscillator has leveled off and is almost unchanged from last week at -122. This is in the buy zone and so I’m looking for signs of strength.

Friday’s large drop took me by surprise and I’m sure I sound like a broken record with my "medium term bullish" view. However, I still believe we’re building a bottom with Professionals accumulating on large volume down days (like Friday) and possible market crash media stories designed to scare the general public into selling.

The swing trading risks might be high right now but the day trading opportunities are great, with large intraday ranges and tradable swings.

Good luck with your Emini trading.

Remember, the Commitment of Traders data is collected weekly after the close on Tuesday and the Commitment of Traders Report is published after the close on Friday.

Commitment of Traders latest charts

Commitment of Traders: Professionals +5.4% (long)

There was a jump in the Professionals' (large SP contract) positions this week. They increased their long positions from 2.7% to 5.4% of total open interest. They were buying as the market continued to slide from Monday to Wednesday last week.

The Large vs Mini contract difference (red line) has also increased this week. So the large contract professionals (the "true" professionals) are more bullish than the mini contract professionals (Emini) – although the line is not rising steeply yet.

Commitment of Traders: Oscillator -123

The Commitment of Traders Oscillator declined from -90 to -123 this week and we're now in the buy zone.

I'm still looking for some weakness during the early part of this week and an "end of trend" signal on the Hilbert Sine Wave. In addition:

• Second half of June is not typically strong
• Swing trading oscillators are not in over-sold territory, and
• Bond market continues to be weak

However, the professionals appear to be accumulating at these levels and so the down side might be limited.

Remember, the Commitment of Traders data is collected weekly after the close on Tuesday and the Commitment of Traders Report is published after the close on Friday.