Hey folk
Yesterday we saw a huge rebound on the intraday. Something promising???
Yesterday we saw a huge rebound on the intraday. Something promising???
Here we go, the disaggregated futures only COT on a 6 months
comparison VS the weekly close price on the S&P500.
The important details to watch is the Net dealer in red, net others in green
and the weekly close price of S&P500 in black. The net dealer are the biggest fund in this market. They can be
government, national bank etc. The net others are the retails trader like us.
The graph tabulate 2015 data, we can see
that the net dealer are accumulating since the start of the year. The net
others just pay attention to them, they are always catching the wrong
direction. When the market is down in late March, they are long, when the
market is at highest in mid May, they are short. When the market is falling in
August, net others are long. When the market is falling more, they buy more.
So we can see that the retails trader are usually wrong,
that why 95% of the participant lost money. The money they lost goes to the 5%
which are the net dealer. So from here we need to watch this 2 category and we
may roughly know where the big trend is heading.
Next we look at the other Net COT.
The graph is the Net COT VS S&P500 weekly close
We need to pay attention to the Comm net in red, the small spec net in green
and the S&P500 weekly closing price in black. The comm net is the
biggest fund and the small spec net are the retails trader.
Is obvious that the accumulation by the comm net is getting
much higher, and is the highest since the start of the year as the weekly price
fall. While the small spec net is trying very hard to catch the trend but fail
most of the time.
From the above 2 fundamental data, the big boys are
accumulating the market very heavily as the price comes off lower. That why in
the last week whasapp, I did add on that buyers might be in the market. Bear in
mind that COT is not a timing indicator, it only tell us where the big boys and
the smart money are moving where the big trend will happen.
However the big boys can be hedgers at time. So much effort
needed to spend on crunching these data further to determine their holdings.
Other than the above 2 charts I still have 3 more using COT to analysis the
positioning. Thus on the last post I said that we need a lot of effort to know
what is happening in the market.
Anyway, currently we have net longs by the big boys.
Seasonal are telling us that end of October is a buy point, it also tell us
that year ending with 5 is a up year. But the weekly price is a downtrend
still. Follow the price. Price rules!! Net Net no change of funds yet until further
notice.
cheers
