COT Reports & Weekly Market Calendar – September 25th, 2015

COT Reports: If you are not familiar, the Commitments of Traders (COT) reports provide a breakdown of each Tuesday’s open interest for markets in which 20 or more traders hold positions. In other words, it gives us a preview of what commercial interests are buying or selling. As the theory goes, we want to be on the same side of the trade as the big guys.

While not a good timing tool, currencies, commodities and the stock market (to a lesser extent) tend to move in the direction of the bets made by the commercial players. Not always, but often enough.

Latest data, as of September 22nd, 2015

Currencies:

USD: 2K Long Vs. 48K Short – Slight increase in net short position. Substantial short interest remains.
Canadian Dollar: 51K Long Vs. 0K Short – Significant long interest remains.
British Pound: 56K Long Vs. 9K Short – Slight decrease in net long interest. British pound is remains bullish.
Japanese Yen: 72K Long Vs. 7K Short – No changes. Japanese Yen is still bullish.
Euro: 92K Long Vs. 18K Short – Slight increase in net short exposure. Significant long position remains. No changes.
Australian Dollar: 92K Long Vs. 1K Short- Slight decrease in net long position. Significant long position remains.

Conclusion: Based on the information above, commercial interests expect the US Dollar to decline while Canadian Dollar, British Pound, Euro, Japanese Yen and Australian Dollar rally.

Markets/Commodities/Volatility:

E-Mini S&P 500: 518K Long Vs. 318K Short – Net neutral position remains. No major changes
VIX: 47K Long Vs. 93K Short – Slight decrease in net short position.
Gold: 62K Long Vs. 61K Short – No major changes. Still neutral.

Conclusion: Based on the information above, commercial interests are now net neutral the S&P and Gold. Please note, commercials have substantially increased their net short position in VIX. That could be due to them expecting a market rally and/or us remaining in a trading range. Considering the fact that S&P is neutral, no definitive conclusion can be ascertained at this time in regards to VIX. Gold is likely to remain within its trading range.

Next Week’s Market Calendar: