Sunday, 17 June 2012

Crude Bullish Signal Bodes Well for Equity Rebound

My trading setup for crude oil goes bullish on this coming week's open of trading after four weeks in cash. Meanwhile, my signal for the Nikkei goes from bullish to cash on the coming weekly open.

Those signals and other data are now up on my latest signals table, which reports on trader positioning in 10 markets I trade using the weekly Commitments of Traders data from the U.S. Commodity Futures Trading Commission.

Overall, the CFTC data appears to be balance bullish this week, signalling favourable odds of a market bounce off the recent weakness. The crude signal is bullish overall for the equity market, and three of my four equity signals are bullish.

The Nikkei, which goes to cash this week, isn't highly correlated with North American equities, so its signal this week isn't necessarily a bearish sign either.

But who knows! The data is often wrong, so do your own homework.

Good luck this week, and Happy Father's Day to all you dads and granddads and great-granddads, etc. My wife and daughters took me to Burlington, VT, and then dinner at the amazing Crossing restaurant in Richford (famous for their peanut butter pie and steak). Wow.


So good.

Thanks, girls! I love you.


I_Got_Prechterized said...

bullish for crude? it's down like 7% this week. I appreciate your work and time, but I'm beginning to think there is no edge in monitoring COT data.

Alex Roslin said...

Hi I_Got,

Yes, some trades lose money. I can't make any kind of judgement about my new group of setups based on a couple of trades and a few weeks of data.

I do know my old (and still current) natural gas setup did great - so I have no doubt about the edge of the COT data. I've done my best to capture those results in the other new setups, but only a year or two of real-life trading will begin to tell me how well I've done so.

See my FAQs page for more thoughts on losing signals.