Every Friday, around 2:30 pm EST, the Commodity Futures Trading Commission (CFTC) publishes the Commitment of Traders report (COT). Because the COT measures long and short net positions taken by speculative traders and commercial traders, it is a good indicator of how heavily these players are involved in the market.
Commitment Of Traders Report
What Is The Commitment Of Traders Report? Everything You Need To Know About This Trading Tool
Introduction
What is the Commitment of Traders Report?
The Commitment of Traders report is a trading tool that measures the activity of speculative investors in the commodities markets. The report is released each Friday by the Commodity Futures Trading Commission (CFTC) and it shows the net position of speculators across various commodity futures markets.
In other words, it tells traders how much money is being put into or taken out of different markets. The Commitment of Traders report can be used to identify trends in the overall market as well as in specific markets
Who uses the Commitment of Traders Report?
The report is used by a variety of people, including traders, analysts, and investors. It can be used to identify trends and predict price movements. The COT report can also be used to measure overall market sentiment.
How to read the Commitment of Traders Report
The report is divided into three sections:
commercial
non-commercial
large trader.
The commercial section includes traders who use futures contracts for hedging or price speculation purposes. The non-commercial section includes traders who do not have a commercial interest in the commodities they trade. The large trader section includes traders who hold positions above a certain size.
cot
I will be sharing with you exactly how you’re supposed to be reading the order flow
of hedge funds in the market. the commitment of traders.it is the positioning of the biggest speculators
in the market. basically they are sum of all their long positions and short positions in the market and if you are
able to understand how they are trading the market you can follow them.
following the big boys in the market and basically you will have an edge over your competitors you
will learn about how you’re supposed to be reading the COT report. I use COT data and Price action strategy if you have information’s on what hedge funds are doing because they’re forced to report their positions you can be trading with them if you know how to read it and get most importantly how to relate it to what is going on in the market.
how to trade with accumulation and distribution in forex
When trading forex, there are two key indicators you need to watch – accumulation and distribution. These indicators tell you when the market is in a bullish or bearish trend.
Accumulation occurs when big investors are buying up large amounts of a currency. This usually happens when the market is bullish and the price is going up. Distribution occurs when big investors are selling off large amounts of a currency. This usually happens when the market is bearish and the price is going down. By watching accumulation and distribution, you can get a better idea of when to buy or sell a currency.
How To Trade Like Banks Using Accumulation & Distribution
when we speak about accumulation usually we refer that to the building up of long positions okay so by orders from an institutional perspective when we refer to distribution we are referring to the liquidation or selling of those buy orders from an institutional perspective.
when you will have an accumulation you will see the market which is obviously in a bear trend then the market creates some horizontal price action which is the accumulation and then the market rejects to the upside.
when it comes to distribution you have a market which is in a long trend so it is in a bullish trend the market then creates some sideways price action and the market then rejects to the downside as yo can see the above pictures
institutional levels are usually monthly support and demand areas.
supply zones that we see from a monthly perspective on long-term historical structure levels. for example we are currently testing one of those in fact we can see how the markets had started this move to the upside again and again at the moment we’re testing this exact same area so there’s a good probability that we will actually see an accumulation inside of this area before the rejection to the upside.
when you identify your zone from a monthly perspective in order to then go and identify an accumulation that could happen at that monthly demand and support zone you need to go down on the daily time frame.
that is where you will easily see if the market has started in accumulation now it would appear by looking at this price reaction that we have just started right now in accumulation with the market that is currently ranging for a few days what could easily happen is that we will see four more days this horizontal price action and then a rejection to the upside.
this is definitely a possibility but at the moment we still don’t have any confirmation from a COT perspective in fact if we look at the euro we still don’t see longs getting added we need to see few reports come out to confirm that we are actually getting an accumulation on the euro.
Things To Look When using COT Report
Net Position
change long
change short
Net position is a fundamental measure of the equity of a trader’s position in a security. It is the difference between the total amount of the security purchased and the total amount of the security sold. Net position is an important indicator of a trader’s overall equity in a security and can be a valuable tool for assessing a trader’s overall trading position.
example on the euro chart above in Oder to take a buy we have to see more longs added on the report and shorts getting closed. in that way it means euro is going upwards. as you can see the report below on change longs it when from -7.008 to -14.544 longs are getting close that’s wy u are seeing the price is at the accumulation zone. when its time to go long you will see longs getting added and shorts getting closed thats when you buy after a set of rules which i am going to share with you.
