Saturday, 25 September 2010

It sure does look like we've put most of the worries about a "fall fall" well behind us. The S&P 500 has topped its highs of the summer, while NDX and copper are testing their highs of the year. But some sectors still can't shake off trouble - crude oil and financials among them. What, oh, what do the wise Commitments of Traders numbers foretell, you ask? Friday's data is gloomy indeed. I've just updated my latest signals table based on the latest COT report from the CFTC. Some highlights:
- S&P 500: Still on track to go bearish Oct. 4 and stay that way for three weeks at least. As you can see from my latest signals table, the "smart money" commercials have hit the panic button and are bailing out. They are now more relatively bearish than at any time since early Dec. 2008, which with their customary three-week trade delay was good timing for the early 2009 final leg down of the market crash.

- Crude oil: My trading setup remains bearish one more week, then goes to cash.

- 30-year U.S. Treasury: My setup goes bullish on this Monday's open of trading (not bearish as I had previously indicated!) That means bullish for the bond (i.e. the yield would fall). Another possible sign of market problems as bond yields tend to drop when equities go down.

- Natural gas: One more week bullish, then to cash on Oct. 4.

- Gold: Bullion has had a sweet run to all-new highs, and my setup is still bullish this coming week. The week following is a little in the air. It could go to cash on Oct. 4, but only if the large speculators go absolutely insanely over the top in their bullishness. Based on the COT positioning, the signal will definitely go either to cash or bearish on Oct. 11.

Hope you fare well this week, and be sure to check back in early in the week to see my updated portfolio page.

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