Down on Copper

Bearish news for copper. The "smart money" commercial hedgers have gotten significantly bearish on copper in their net futures and options positioning as compared to recent data, according to the latest Commitments of Traders report.

That's helped push my copper trading signal into the bearish column. The signal takes effect on next week's open of trading.

See my latest signals table for more details on the copper positioning and how traders are positioned in the nine other markets I trade using the free weekly COT data from the U.S. Commodity Futures Trading Commission. 

Good luck next week.

Short Natural Gas, Long Crude Oil: Says COT Data

I'm getting short natural gas and long crude oil. Those are my two signals taking effect on next week's open of trading based on the latest Commitments of Traders data from the U.S. Commodity Futures Trading Commission.

See my latest signals table for more details on trader positioning in these and the other markets I trade using the free weekly COT data.

In natural gas, large speculator firms and small traders both have accumulated highly bearish positioning in their futures and options total open interest. My backtesting suggests it's best to trade alongside these two trader groups in natural gas.

Note that most other watchers of the COT data say you should always trade opposite to the large specs and small traders - often called the "dumb money." But these tend to be people who've never actually tested the data properly!

In crude oil, the large specs (whom I do fade in this market) and small traders (whom I follow) are both now lined up to give me a bullish signal.

In silver, my bullish position has hit its stop as the price of silver has dropped. My usual practice when a position is stopped out is to consider a trade in the opposite direction, a little trick I learned from Stephen Vita's excellent Alchemy of Trading website.

Have a good long weekend, Canadian readers, and good luck to all next week.

All Quiet in Land O' Commitments of Traders

All quiet in Commitments of Traders land.

No new signals this week from my trading system based on the weekly COT reports issued by the lovely and talented U.S. Commodity Futures Trading Commission.

But you can still get hours of enjoyment and infotainment by checking my latest signals table, which details trader positioning in the 10 markets I trade using the COT data.

Have a good weekend, and Happy Mother's Day, mom, as well as to all you other hard-working mom readers. Good luck next week.

Natural Gas Gives Up Gains, Goes to Cash

Just one signal takes effect this coming week in my trading system based on the weekly Commitments of Traders reports: cash for my natural gas signal.

It's been bullish since March 25, but trader positioning has lately turned decisively bearish. The signal could even go bearish in two weeks' time, depending on how the positioning evolves.

The signal, which has proven highly profitable over the past couple of years, looked like it was going to be another winner until this past week, when natural gas suddenly collapsed in price. The signal is now about even.

It's a little disappointing, but it doesn't really bother me. The key in all trading, in my opinion, is a good long-term record of wins, not trying to win every time. See my FAQs page for more thoughts on how I handle signals that don't do well.

And see my latest signals table for more details on how traders are positioned in various markets I'm trading.

Good luck this week.