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WEEKLY COT COMMENTARY  

3/5/2010 posted noon eastern  

Click here to see the NEW COT  "WEEKLY SUMMARY OF THE DISAGGREGATED CFTC REPORT."  

Buy call options on Wheat 
in this pullback.

Two weeks ago I explained that the COT data for WHEAT suggested an opportunity from an "out of balance" or potentially "dysfunctional" market. I explained that when analyzing the "Disaggregated COT Report" and the "Supplemental COT Report", we could see that the major positions IN WHEAT were the net short positions of the large trend following managed futures opposite the net long commercial positions and the net long index trader positions. If the large managed futures traders saw a change in trend to the upside, I explained that I thought that might result in some aggressive moves in the market to the upside as the large managed futures trader priced up the market to try to cover their net short positions.

Last week I explained that May wheat had moved up from near $5.00 to over $5.20. I said if we see a pull back in the next few days, and then a new run to the upside, I suggested you consider that to be potentially an important change in trend signal and then consider long positions in futures or call options, with stops.

This morning,  Friday March 5, at about 10:50 am, I sent an email to my paying subscribers to my combined websites Commitments of Traders .com, Stock Index Timing .com and Commodity Index Timing .com making the recommendation to buy an April Wheat $520 call for 8 cents or better. I am repeating that recommendation Friday at noon by posting this free weekly commentary and this evening at 4 pm when mailing this free weekly email.

Futures Option trade recommendation: Buy an April Wheat $520 call for 8 cents or better. The option expires in 21 days. If in the money at expiration, the option exercises into a May future. Risk is the net premium paid plus commission if exited before expiration.

Good luck and good trading!

George

 Charts of Supplemental Report data        

NEW SHORTCUT TO THIS WEB PAGE www.cot1.com    

OPEN TRADE RECOMMENDATIONS:

Following are the open trade recommendations in this free weekly commentary. Subscribers should see Commodity Index Timing .com (shortcut www.cit1.com ) and Stock Index Timing .com (shortcut www.sit1.com ) for further  recommendations.

OPEN FUTURES OPTION TRADE RECOMMENDATION: HOLD the JULY 2010 SUGAR 11 cent put bought for 50 or better on 5/18/09. In sugar each 1.00 cent is $1,120, so 50 points is 50 times $11.20 or $560. Risk the net premium plus commission

Sugar option prices:

Open Futures Option trade recommendation: Hold the April Wheat $520 call for 8 cents or better. The option expires in 21 days. If in the money at expiration, the option exercises into a May future. Risk is the net premium paid plus commission if exited before expiration.

Click the 'Sign up' button to receive this FREE weekly commentary on the Commitments of Traders Report:

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Past special commentary archive

20090227 100 year chart of corn and the new inflation plateau.

20090612  the trend following managed futures- are driving this market, not passive institutional investors

20090918  Explanation of using COT data to identify a watch for a trend turn in Gold. 

Copy of free weekly EMail

HOLIDAY SCHEDULE

NOTE TO SUBSCRIBERS: 
I try to post the above linked COT Tables to the web site prior to 4 PM eastern on the release date. The commentary will normally be updated between 4:00 to 5:00 PM eastern on the release date. The weekly charts with the COT data plotted are updated by 8 pm eastern on the release date.

WEEKLY OPEN INTEREST SUMMARIES ARE POSTED ON SEPARATE PAGES. Click on the above links Futures Only  
and 
Combined Futures and Options 
 
and 
Supplemental CIT
to view the summary tables of the current release data.

Chart and quote links

BarChart
Quotes, and daily charts








Contract Specifications  

See Futures Trading School for memos and other links of interest

See background page for a possible "trading strategy."

PS Would you like me to consult with your firm on these or other matters? Call me at 239-947-9131, or email me at george@georgeslezak.com 

Email george@georgeslezak.com for more information.

The $50 per month subscription to Commitments of Traders .com includes access to Stock Index Timing .com  Commodity Index Timing .com , where recommendations in the stock and commodity markets are made each week end considering the data in the COT Report. 

The $50 per month subscription is billed month to month to your credit card, click here to subscribe)

Comments and trade recommendations are selected from the markets that are highlighted with light green or light red in the 12 week summary of reportable net commercial positions and in the 12 week summary of reportable net commercial positions "with options" . The markets highlighted in light green or red are markets where the position of the net commercial hedge traders are near the FIVE YEAR record net high or net low number of contracts. The strategy followed in this web site is usually to then trade on a breakout of the two week high/low, in the direction of the net commercial position, with stops at the opposite two week high/low.

The 12 week summary schedules also identify when the reportable net commercial positions are near the high or low of their ONE YEAR or THREE YEAR range. They are then highlighted in yellow and identified by I or III (or I- or III- ) in the columns. I recommend that if you consider trades following the net commercials in markets where the reportable net commercial position is near the one year or three year range that you use a shorter term trading strategy with daily monitoring. 

My choice of markets for comment or trade recommendation is not suggested as the optimal choices. I am not commenting, and I am not making trade recommendations on every market highlighted in the 12 week summaries.

All aspects of any trade recommendations contained in this report are subject to modification at any time. 

Beginning in 2002, the CFTC will release the "with options" data on Friday evenings at the same time as the "futures only" reports. The weekly commentary on the "Net Options" summary will be combined into the "futures only" commentary.

Commitments of Traders calendar of 2009 CFTC release dates.  Weekly Commitments of Traders Reports are released by the CFTC every Friday at 3:30 pm eastern, effective for the prior Tuesday's close. The release dates may be adjusted to accommodate holidays. Usually, the summaries of the CFTC COT Report in this web site are updated with the new CFTC information by 4 PM Eastern time after the release of the data. The weekly front month charts with the COT data plotted are usually updated by 7 PM.

The CFTC has posted a background report of the COT Report. See Backgrounder-The Commitments of Traders Report The Report contains general background information and detailed explanatory notes for the short form, the long form, and the options-and-futures-combined reports.

Beginning in January 2002, the CFTC releases the futures data combined with the net deltas of option positions on each Friday evening. The weekly report shows the information as of the close for the previous Tuesday.

The tables in this Web site are summaries of selected data obtained from the report issued by an agency of the US Government, the Commodity Futures Trading Commission (CFTC). The entire report can be obtained from http://www.cftc.gov/ .

The "v" or "v-" following the net position in the 12 week summary tables indicates if the net position is within 95% of the high of the five year range, or within 5% of the low of the five year range. "I" or "I-" indicate within 95% or 5 % of the one year range. "III" or "III-" indicate within 95% or 5% of the three year range.

Footnotes on data presented:

  • All data has been drawn from the CFTC website and begins with January 1986. Accuracy of the data is not guarenteed by the CFTC or by the publisher in any way.
  • Lumber changed with the May 96 contract to 80,000  board feet from 160,000. Open interest data for prior to May 96 is doubled and reflected in the current information.
  • S&P open interest data prior to 10/31/97 has been restated by doubling such amounts to reflect the change in the multiplier from $500 per point to $250.
  • Lean 
  • Hog data is combined with the Live Hog data from prior to the contract change in 1997.
  • The Feeder Cattle contract change from 44,000 pounds to 50,000 pounds with the Jan 1993 contract did not result in a change in CFTC reporting.
  • The change in the Grain contracts 12/31/97 from stated in number of thousands of bushels to contracts of 5,000 bu is reflected in past data by dividing the published numbers by 5.
  • Trading in Unleaded Gas has been replaced with Reformulated Blend gas in 2006. In this web site, price history and COT history during 2006 are combined. Prior to 2006 history shown is from the Unleaded Gas contract.

C 1999-2006 George Slezak
For more information call George at 1-888-311-3400

All aspects of any trade recommendations contained in this report are subject to modification at any time. 

FUTURES TRADING INVOLVES SIGNIFICANT RISK OF LOSS AND IS NOT SUITABLE FOR EVERYONE AND THE RISK OF LOSS SHOULD BE CONSIDERED CAREFULLY BEFORE MAKING ANY TRADES. A STOP LOSS MAY NOT LIMIT YOUR LOSS TO THE AMOUNT INTENDED.  YOU SHOULD BE FOREWARNED THAT SYSTEMS WHICH TRIGGER FREQUENT TRADING SIGNALS AS PART OF A DAY TRADING STRATEGY CAN RESULT IN SUBSTANTIAL COMMISSIONS AND FEES. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. ANY STATEMENT OF FACTS HEREIN CONTAINED ARE DERIVED FROM SOURCES BELIEVED TO BE RELIABLE, BUT ARE NOT GUARANTEED AS TO ACCURACY, NOR DO THEY PURPORT TO BE COMPLETE.

ANY REFERENCE TO PERFORMANCE IS INTENDED TO BE UNDERSTOOD AS STRICTLY THEORETICAL. 

REGULATORY DISCLOSURES REGARDING HYPOTHETICAL RESULTS

HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY PARTICULAR TRADING PROGRAM.

ONE OF THE LIMITATIONS OF HYPOTHETICAL PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY AFFECT ACTUAL TRADING RESULTS. PAST PERFORMANCE IS NOT NECESSARILY INDICATIVE OF FUTURE RESULTS. THE RISK OF LOSS EXISTS IN FUTURES TRADING.

All traders should read the  CFTC CONSUMER ALERTS and the "COMMISSION ADVISORY" on trading systems.

 

 

 

 

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