By InvestMacro
The latest update for the weekly Commitment of Traders (COT) report was released by the Commodity Futures Trading Commission (CFTC) on Friday for data ending on April 1st.
This weekly Extreme Positions report highlights the Most Bullish and Most Bearish Positions for the speculator category. Extreme positioning in these markets can foreshadow strong moves in the underlying market.
To signify an extreme position, we use the Strength Index (also known as the COT Index) of each instrument, a common method of measuring COT data. The Strength Index is simply a comparison of current trader positions against the range of positions over the previous 3 years. We use over 80 percent as extremely bullish and under 20 percent as extremely bearish. (Compare Strength Index scores across all markets in the data table or cot leaders table)
Here Are This Week’s Most Bullish Speculator Positions:
Live Cattle
The Live Cattle speculator position comes in as the most bullish extreme standing this week as the Live Cattle speculator level rose to a 100.0 percent score of its 3-year range.
The six-week trend for the percent strength score totaled 14.8 this week. The overall net speculator position was a total of 123,646 net contracts this week with a gain of 5,659 contract in the weekly speculator bets.
Speculators or Non-Commercials Notes:
Speculators, classified as non-commercial traders by the CFTC, are made up of large commodity funds, hedge funds and other significant for-profit participants. The Specs are generally regarded as trend-followers in their behavior towards price action – net speculator bets and prices tend to go in the same directions. These traders often look to buy when prices are rising and sell when prices are falling. To illustrate this point, many times speculator contracts can be found at their most extremes (bullish or bearish) when prices are also close to their highest or lowest levels.
These extreme levels can be dangerous for the large speculators as the trade is most crowded, there is less trading ammunition still sitting on the sidelines to push the trend further and prices have moved a significant distance. When the trend becomes exhausted, some speculators take profits while others look to also exit positions when prices fail to continue in the same direction. This process usually plays out over many months to years and can ultimately create a reverse effect where prices start to fall and speculators start a process of selling when prices are falling.
Brent Oil
The Brent Oil speculator position comes next in the extreme standings this week after a spot at the 6th most bullish last week. The Brent Oil speculator level is now at a 96.4 percent score of its 3-year range.
The six-week trend for the percent strength score was 49.2 this week showing a sharp move higher. The speculator position registered -2,843 net contracts this week with a weekly boost by 3,685 contracts in speculator bets.
Japanese Yen
The Japanese Yen speculator position comes in third this week in the extreme standings after topping the list last week. The Japanese Yen speculator level resides at a 96.2 percent score of its 3-year range.
The six-week trend for the speculator strength score came in at 19.2 this week. The overall speculator position was 121,774 net contracts with a decline of -3,602 contracts in the weekly speculator bets.
Silver
The Silver speculator position comes up number four (same as last week) in the extreme standings this week. The Silver speculator level is currently at a 88.5 percent score over its 3-year range.
The six-week trend for the speculator strength score totaled a small gain of 3.5 this week. The overall speculator position was 57,258 net contracts this week with a dip by -3,692 contracts in the speculator bets.
Brazil Real
The Brazil Real speculator position rounds out the top five in this week’s bullish extreme standings. The Brazil Real speculator level currently sits at a 87.4 percent score over its 3-year range. The six-week trend for the speculator strength score was a strong 34.3 this week.
The speculator position totaled 37,035 net contracts this week with a reduction by -3,314 contracts in the weekly speculator bets.
This Week’s Most Bearish Speculator Positions:
5-Year Bond
The 5-Year Bond speculator position comes in as the most bearish extreme standing again this week as the 5-Year Bond speculator level dropped to a 0.0 percent score of its 3-year range.
The six-week trend for the speculator strength score was -14.8 this week. The overall speculator position was -2,021,677 net contracts this week with a drop of -121,590 contracts in the speculator bets.
Wheat
The Wheat speculator position comes in tied for the most bearish extreme standing on the week with the Wheat speculator level now at 0.0 percent score of its 3-year range.
The six-week trend for the speculator strength score was strong -50.2 this week. The speculator position totaled -102,800 net contracts this week with a decrease by -20,252 contracts in the weekly speculator bets.
Soybean Meal
The Soybean Meal speculator positio
