Friday 16 December 2011

Out of Gold, Bearish for Gas and Nikkei

Three signals take effect on next Monday's open of trading, coming out of my trading setups based on the weekly Commitments of Traders report from the U.S. Commodity Futures Trading Commission:

- Gold goes from bullish to cash. This is based on excessive bullishness in the large speculator total open interest starting several weeks ago. We could be in cash (or potentially bearish) for awhile.

- Natural gas goes from bullish to bearish. This signal will last two weeks.

- Nikkei goes from bullish to bearish. This signal will last two weeks too.

In other news, the S&P 500 data is still flipping around like a fish on the dock. The latest COT data issued this afternoon shows that the wrong-way small trader crowd has reduced its net positioning to the point that it's actually bullish. So that puts the overall setup, which goes to bearish on Dec. 26, back into cash on Jan. 9.

Hope you have a good weekend, and good luck next week! It's beginning to feel a lot like Christmas - except where's all the snow?! This time last year, we'd had weeks and weeks of non-stop snow up here in Quebec ski country. This year, we've just had lots of rain. I'm dreaming of a muddy Christmas. Thanks for nothing, global warming!

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