Special Thread: COT Data Analysis & Trading Signals

Hi, Thanks again for your sharing.
Given the COT reprt is based on last weeks data, Tuesday, and we have subsequantly had the surprise NFP result which has no doubt pushed back interest rates cuts.
Do you think that this weeks report may change dramaticallly next week? Looking at USDCAD , its been sitting in a triangle channell for some time with potential for a break either way. Most sentiment has been for a falling USD, hense bias to short. But this will surely have changed now and
this fridays report may show a different picture and trading short USDCAD (other than for a retrace) may be dangerous.




Interested in your thoughts.
thanks

do you have analysis for gold this week?

Live Trade Signal:
Symbol: CADCHF
Entry: SELL @cmp
Image: CADCHF - M30

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Confluence:
1. PA (D1, H4, M30 and M15)
2. COT data: Non-Commercials
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COT Net Bias Analysis for CAD/CHF - Week Ending June 04, 2024

A: Non-Commercial
Key Individual Currency Sentiment:
Canadian Dollar (CAD):

1. Net Position: Net Short
2. Bias Strength (% of OI): 34.5%
3. Change in Net Position: Decreased by 5,115 contracts (-5.3% Change)
4. Open Interest Trend: Increasing
5. Change in Long Contracts: Increased by 61 contracts (1.6% Change)
6. Change in Short Contracts: Increased by 5,115 contracts (4.0% Change)

Swiss Franc (CHF):

1. Net Position: Net Short
2. Bias Strength (% of OI): 46.3%
3. Change in Net Position: Decreased by 205 contracts (-0.4% Change)
4. Open Interest Trend: Increasing
5. Change in Long Contracts: Decreased by 1,192 contracts (-13.1% Change)
6. Change in Short Contracts: Increased by 205 contracts (0.4% Change)

Currency Pair:

1. Overall Non-Commercial Net Bias: Bearish
2. Key Drivers:
   1. CAD: Net short with 34.5% of open interest. Decreased short positions by 5,115 contracts (-5.3% Change) since last week.
   2. CHF: Net short with 46.3% of open interest. Decreased short positions by 205 contracts (-0.4% Change) since last week.
   3. Open Interest: Overall open interest is increasing, suggesting heightened market participation.

   
   
   

Potential Market Implications:
The increasing open interest and bearish non-commercial bias suggest a potential for continued downward pressure on the CAD/CHF pair. This indicates that speculative traders are becoming more bearish on the pair, possibly due to expectations of a weaker Canadian Dollar or a stronger Swiss Franc. The stronger short positions in CHF than CAD suggest that speculators are expecting a wider spread between the two currencies. However, the recent decrease in net short positions for both currencies suggests some short-covering might be taking place.
Trading Recommendations (Optional):

1. Potential Short Positions: Consider establishing short positions on CAD/CHF with a stop-loss order above recent highs, targeting a move towards recent lows or support levels. Monitor open interest for further increases in speculative short positions, which could suggest continued downward pressure.

B: Commercial
Key Individual Currency Sentiment:
Canadian Dollar (CAD):
* Commercial Net Position: Net Long (37.6% of OI)
* Changes in Net Position: Increased from previous week
* Open Interest Trend: Increasing
* Commercial Long Contracts: Increased by 3,704 contracts (1.9% Change)
* Commercial Short Contracts: Decreased by 5,847 contracts (-5.9% Change)

Swiss Franc (CHF):
* Commercial Net Position: Net Long (57.5% of OI)
* Changes in Net Position: Decreased from previous week
* Open Interest Trend: Increasing
* Commercial Long Contracts: Decreased by 3,464 contracts (-4.3% Change)
* Commercial Short Contracts: Decreased by 2,345 contracts (-10.2% Change)

Net Bias for CAD/CHF:

1. Overall Commercial Net Bias: Neutral
   1. Rationale: While CAD shows a bullish bias, CHF shows a neutral bias. This mixed commercial sentiment creates a neutral bias for the pair.

   
   
   

Potential Market Implications:
The recent increase in commercial long positions for CAD and the decrease in CHF long positions suggest commercial traders are less bearish on CAD, potentially expecting a stronger CAD relative to CHF. However, the neutral bias for the pair indicates that commercial traders are not strongly positioned for a major move in either direction.
Trading Recommendations (Optional):

1. Neutral Sentiment: Commercial traders are not clearly leaning towards a bullish or bearish bias for CAD/CHF. This suggests caution is warranted. It is recommended to monitor the pair closely for any changes in commercial sentiment, especially for large shifts in long or short contracts.

C: Final Bias Assessment for CAD/CHF
This section integrates the net bias data from Sections A (Non-Commercial) and B (Commercial) to determine the overall bias for the CAD/CHF pair.

1. Non-Commercial Bias: Net Short - Bearish
2. Commercial Bias: Neutral - Neutral

Reconciliation and Final Bias Assessment:

1. Agreement/Disagreement: The biases from the two groups disagree. While non-commercial traders exhibit a strong bearish bias, commercial traders are essentially neutral.
2. Bias Strength: Non-commercial traders have a stronger bearish bias, with a 34.5% short position in CAD and a 46.3% short position in CHF, compared to commercial traders who have a balanced net position with a slight long bias in CAD.

Conflicting Signals:

1. Historical Performance: It is essential to consider the historical performance of both commercial and non-commercial traders to determine which group's bias has been more reliable in the past.
2. Extreme Net Positioning: The non-commercial net short position in CHF is quite high (46.3% of OI) which could be a sign of an overextended market, suggesting a potential for a reversal.
3. Market Volatility: The increasing open interest suggests higher speculative activity, which could amplify price movements.
4. Open Interest Trends: The increased open interest for both currencies suggests a greater level of interest in the pair.
5. Recent Price Action: The recent price action of CAD/CHF should be analyzed to assess how the pair has reacted to past COT data releases and other market events.
6. Sentiment Analysis: Any news, social media trends, or analyst opinions that could influence the perception of the Canadian Dollar or Swiss Franc should be considered.

Final Net Bias for CAD/CHF:
Overall Bias: Mixed, but with a potentially stronger bearish influence from non-commercial traders.
Rationale for Mixed Bias:

1. Conflicting Signals: While commercial traders show a neutral bias for the pair, non-commercial traders exhibit a strong bearish bias.
2. Weighing the Evidence: The strong bearish bias from non-commercial traders, coupled with the increased open interest, suggests a potential for continued downward pressure on the pair. However, the neutral commercial bias and the possible overextended short position in CHF should be taken into consideration.
3. Impact of Extreme Positioning: The extreme net short position from non-commercial traders suggests a heightened risk of a potential reversal. This is because these positions could be seen as overcrowded and vulnerable to profit-taking.

Trading Recommendations (Optional):

1. Cautious Approach: The mixed bias for CAD/CHF indicates a degree of uncertainty in the market. It's recommended to exercise caution when trading the pair.
2. Monitoring COT Reports: Continuously monitoring COT data releases for potential shifts in bias from both commercial and non-commercial traders is essential.
3. Strategic Options: Consider using options strategies to manage risk and potential for volatility, like covered puts for a bullish outlook or covered calls for a bearish outlook.
4. Wait for Confirmation: Wait for a clear signal of directional bias from both commercial and non-commercial traders before establishing any significant positions.

Disclaimer: This analysis is based solely on COT data and does not consider other market factors. Use this information at your own discretion and with thorough risk management.

Thanks. I will have a look after London opens and we are below todays open.

excellent, got in after london......away now
ADR is 64.91 will TP there and then relook

Live Trade Signal
Symbol: GBPJPY
Entry: BUY @cmp
TimeFrame: H4

Trade Confluence
- Daily and H4 PA ( OHLC )
- COT data: Stronger bullish influence from non-commercial traders
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Full Text COT Report below:

COT Net Bias Analysis for GBP/JPY - Week Ending June 04, 2024

A: Non-Commercial:
Key Individual Currency Sentiment:
GBP:

1. Net Position: Net Long
2. Bias Strength (% of OI): 16.1%
3. Change in Net Position: Decreased by 8,731 contracts (-16.8%)
4. Open Interest Trend: Increasing
5. Change in Long Contracts: Increased by 9,077 contracts (9.6%)
6. Change in Short Contracts: Decreased by 8,731 contracts (-12.9%)

JPY:

1. Net Position: Net Short
2. Bias Strength (% of OI): 43.5%
3. Change in Net Position: Decreased by 12,076 contracts (-8.4%)
4. Open Interest Trend: Increasing
5. Change in Long Contracts: Increased by 11,862 contracts (40.9%)
6. Change in Short Contracts: Decreased by 12,076 contracts (-6.6%)

Currency Pair:

1. Overall Non-Commercial Net Bias: Bullish
2. Key Drivers:
   1. GBP: Net Long with 16.1% of open interest. Decreased by 8,731 contracts (-16.8%) since last week.
   2. JPY: Net Short with 43.5% of open interest. Decreased by 12,076 contracts (-8.4%) since last week.
   3. Open Interest: Overall open interest is Increasing, suggesting Increased market participation.

   
   

Potential Market Implications:
The non-commercial COT data suggests a potential bullish bias for GBP/JPY. The decrease in net long GBP positions could indicate profit-taking from non-commercial traders, but the increase in long positions suggests a more cautious, "wait and see" approach. The simultaneous decrease in net short JPY positions also indicates a potential shift toward a more bullish sentiment. The increase in open interest in both currencies suggests growing market participation. However, the strength of the JPY short bias is notable, potentially indicating resistance for GBP gains. We could expect a potential increase in volatility if non-commercial traders become more aggressive in the coming weeks.

Trading Recommendations (Optional):
While the non-commercial data suggests a potential bullish bias, the recent decrease in net long GBP positions and the strength of the JPY short bias warrant caution. Consider waiting for confirmation of a break above recent resistance levels before establishing long positions in GBP/JPY.

B: Commercial
Key Individual Currency Sentiment:
GBP:
* Commercial Net Position: Net Short (-18.2% of OI)
* Changes in Net Position: Decrease from previous week
* Open Interest Trend: Increasing
* Commercial Long Contracts: Decreased by 5,392 contracts (-4.6%)
* Commercial Short Contracts: Increased by 11,213 contracts (7.0%)
JPY:
* Commercial Net Position: Net Long (42.9% of OI)
* Changes in Net Position: Decreased from previous week
* Open Interest Trend: Increasing
* Commercial Long Contracts: Decreased by 42,081 contracts (-17.0%)
* Commercial Short Contracts: Decreased by 5,854 contracts (-7.2%)
Net Bias for GBP/JPY:

1. Overall Commercial Net Bias: Neutral
   1. Rationale: The decrease in commercial net long JPY positions and the increase in commercial net short GBP positions suggest a slight bearish bias for the pair. However, these changes are relatively modest, suggesting a more neutral view among commercial traders.

   
   

Potential Market Implications:
The decrease in commercial net long JPY positions suggests that commercial traders may be becoming more cautious about holding long JPY positions. The increase in commercial net short GBP positions suggests that commercial traders may be expecting GBP to weaken. However, these changes are relatively modest and could simply reflect hedging activities. Overall, the commercial COT data suggests a more neutral outlook for GBP/JPY.

Trading Recommendations (Optional):
The commercial COT data suggests a more neutral outlook for GBP/JPY. Consider using other technical or fundamental analysis tools to determine entry and exit points.

C: Final Bias Assessment for GBP/JPY
This section integrates the net bias data from Sections A (Non-Commercial) and B (Commercial) to determine the overall bias for the GBP/JPY.

1. Non-Commercial Bias: Net Long - Bullish
2. Commercial Bias: Net Short - Neutral

Reconciliation and Final Bias Assessment:

1. Agreement/Disagreement: The biases for the currency pair from both groups disagree. Non-commercial traders exhibit a bullish bias, while commercial traders are relatively neutral.
2. Bias Strength: Non-commercial traders exhibit a strong bullish bias. Commercial traders have a moderate bearish bias, although their net short position is not particularly large.

Conflicting Signals: Commercial traders are becoming more cautious about long JPY positions while non-commercial traders are bullish on GBP, indicating a divergence in sentiment. The large increase in non-commercial long GBP positions could be a leading indicator of a significant price move, but caution is warranted due to the decrease in non-commercial net long GBP positions, which could indicate profit-taking.

Final Net Bias for GBP/JPY:

Overall Bias: Mixed, with a potentially stronger bullish influence from non-commercial traders.
Rationale for Mixed Bias:

1. Conflicting Signals: While commercial traders are becoming more neutral on GBP/JPY, non-commercial traders remain bullish. This suggests a potentially complex market dynamic, where short-term sentiment might be driving the pair higher.
2. Weighing the Evidence: Despite the decrease in net long GBP positions from non-commercial traders, the overall open interest in GBP continues to rise, indicating increased conviction among non-commercial traders. However, the strength of the JPY short bias from both groups could limit GBP's upside potential.
3. Impact of Extreme Positioning: The extreme net short position from non-commercial JPY traders could be a significant factor. This suggests that if there is a sharp reversal in JPY sentiment, GBP/JPY could see a rapid and significant price move.

Trading Recommendations (Optional):
The conflicting signals from commercial and non-commercial traders warrant a cautious approach. While the potential for a bullish breakout remains, it is crucial to use other technical and fundamental indicators to confirm a strong bullish bias. Monitor future COT reports for potential shifts in sentiment. Additionally, pay close attention to price action and consider using stop-loss orders to manage risk.

Disclaimer: This analysis is based solely on COT data and does not consider other market factors. Use this information at your own discretion and with thorough risk management.

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GBPJPY | Price failed to HIT my TP, Manually closed

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Symbol: AUDCAD | Price will drop as per D1 and H4 PA
Live Trade Entry: SELL @cmp
TimeFrame: M30

Attached Image (click to enlarge)

COT Net Bias Analysis for GBPAUD - Week Ending June 04, 2024

This report analyzes the Commitments of Traders (COT) data for the GBP (British Pound) and AUD (Australian Dollar) to determine the overall net trading bias for the GBPAUD currency pair.

A: Non-Commercial:
Key Individual Currency Sentiment:
GBP:

1. Net Position: Net Long
2. Bias Strength (% of OI): 16.1%
3. Change in Net Position: Decreased by 8,731 contracts (-16.8% Change)
4. Open Interest Trend: Flat
5. Change in Long Contracts: Increased by 9,077 contracts (9.6% Change)
6. Change in Short Contracts: Decreased by 8,731 contracts (-12.9% Change)

AUD:

1. Net Position: Net Short
2. Bias Strength (% of OI): 25.7%
3. Change in Net Position: Decreased by 844 contracts (-1.6% Change)
4. Open Interest Trend: Flat
5. Change in Long Contracts: Decreased by 2,231 contracts (-4.1% Change)
6. Change in Short Contracts: Decreased by 844 contracts (-0.8% Change)

Currency Pair:

1. Overall Non-Commercial Net Bias: Bullish
2. Key Drivers:
   1. GBP: Net long with 16.1% of open interest. Decreased slightly by 8,731 contracts since last week.
   2. AUD: Net short with 25.7% of open interest. Decreased modestly by 844 contracts.
   3. Open Interest: Overall open interest is flat, suggesting steady market participation.

Potential Market Implications:
Despite the decline in both GBP and AUD non-commercial net positions, the GBPAUD remains bullish due to the stronger bullish bias in GBP. The decline in long contracts for AUD suggests a slight pullback in short positions, potentially indicating a weaker AUD in the near term. The flat open interest suggests a lack of strong conviction in either direction, so a range-bound market may occur.

Trading Recommendations (Optional):
The bullish bias suggests a potential for further appreciation in GBPAUD. However, the flat open interest and modest decline in net positions suggest a possible range-bound market. Consider carefully placed long positions with a tight stop loss, or a range-bound trading strategy.

B: Commercial
Key Individual Currency Sentiment:
GBP:
* Commercial Net Position: Net Short (-18.2% of OI)
* Changes in Net Position: Decreased from previous week
* Open Interest Trend: Flat
* Commercial Long Contracts: Decreased by 5,392 contracts (-4.6% Change)
* Commercial Short Contracts: Increased by 11,213 contracts (7.0% Change)
AUD:
* Commercial Net Position: Net Long (23.5% of OI)
* Changes in Net Position: Increased from previous week
* Open Interest Trend: Flat
* Commercial Long Contracts: Increased by 4,791 contracts (4.2% Change)
* Commercial Short Contracts: Increased by 7,228 contracts (11.5% Change)

Net Bias for GBPAUD:

1. Overall Commercial Net Bias: Neutral
   1. Rationale: The GBP commercial net position has decreased (more shorting) while the AUD net position has increased (more long positions). While there is a slight lean toward AUD strength, the changes suggest a neutral market bias overall.

Potential Market Implications:
The commercial net positions suggest a neutral sentiment toward the GBPAUD pair. The increase in AUD long positions and the decline in GBP short positions could suggest a potential for some short-term AUD strength. However, the overall neutral bias indicates a market that is not strongly leaning in either direction.
Trading Recommendations (Optional):
The neutral commercial bias suggests a cautious approach. Consider waiting for clearer signals from other technical indicators or fundamental analysis before taking a position. Alternatively, range-bound strategies may be more appropriate given the potential for price fluctuations.

C: Final Bias Assessment for GBPAUD
This section integrates the net bias data from Sections A (Non-Commercial) and B (Commercial) to determine the overall bias for the GBPAUD.

1. Non-Commercial Bias: Bullish
2. Commercial Bias: Neutral

Reconciliation and Final Bias Assessment:

1. Agreement/Disagreement: The biases for the GBPAUD from both groups disagree. While the non-commercial group is bullish, the commercial group is neutral.
2. Bias Strength: The non-commercial bias is stronger, as the GBP non-commercial net position is significantly larger than the AUD commercial net position.

Conflicting Signals: While commercial traders have shifted slightly towards a more neutral view, non-commercial traders are still demonstrating a clear bullish bias. This suggests that short-term speculative traders are driving the current upward pressure on the GBPAUD pair, potentially pushing it higher. However, the lack of strong conviction from the commercial group, which represents long-term traders and hedgers, could cap gains.
Final Net Bias for GBPAUD:
Overall Bias: Bullish, but with a potentially stronger influence from non-commercial traders.
Rationale:

1. Points of Disagreement: Non-commercial traders are bullish, driven by the GBP long bias, while commercial traders are neutral, reflecting a lack of strong conviction on either side.
2. Weighing the Evidence: The strong non-commercial bias, particularly in the GBP, suggests the pair could continue to rise in the short term. However, the weaker commercial bias suggests caution about potential upside.
3. Impact of Extreme Positioning: The non-commercial GBP bias is relatively high. While not extreme, this could be a source of downward pressure if short-term traders decide to unwind positions.

Trading Recommendations (Optional):
The bullish bias, driven by non-commercial traders, suggests a possible opportunity for long positions. However, the neutral commercial bias and potential for a reversal in non-commercial sentiment should be carefully considered.

1. Long Entry: Consider carefully placed long positions with a tight stop loss, aiming for a short-term gain.
2. Risk Management: Carefully manage your risk, particularly if you are entering a long position, given the potential for a reversal in sentiment.
3. Monitoring COT Reports: Closely monitor future COT reports for changes in the non-commercial and commercial biases to adjust your trading strategy accordingly.

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Live Signal
Entry: BUY @cmp
TF: M30

Symbol: GBPAUD
Entry: SELL @cmp | SL = 21pips, TP=78pips
Chart TF: M30

Symbol: GBPNZD
Entry: SELL @cmp | SL=34pips, TP=89pips
Chat TF: M30

#Symbol: NZDJPY
#TF: H1

I haven't been on FF in a long while... Nice Thread!

Am back! | My 1st trade of the Day

Hi, Ive continued shorting EURNZD through the levels, flat now. We now have a weekly close below the yearly open of 1.7467,
and the support dating back to 4th December is broken.
This was retested as resistance on the daily and held....so room for a further short?
Potentially to 1.7217
I wonderd what the updated COT looks like?

Weekly



daily

COT Net Bias Analysis for XAUUSD - Week Ending June 11, 2024

A: Non-Commercial (Speculative) Sentiment:
Key Individual Currency Sentiment:
GOLD (XAU):

1. Net Position: Net Long
2. Bias Strength (% of OI): 53.5%
3. Change in Net Position: Decreased by 12,218 contracts (-2.8% Change)
4. Open Interest Trend: Decreasing
5. Change in Long Contracts: Decreased by 7,797 contracts (-2.8% Change)
6. Change in Short Contracts: Decreased by 4,421 contracts (-10.3% Change)

US DOLLAR (USD):

1. Net Position: Net Long
2. Bias Strength (% of OI): 13.1%
3. Change in Net Position: Decreased by 816 contracts (-17.1% Change)
4. Open Interest Trend: Decreasing
5. Change in Long Contracts: Decreased by 345 contracts (-1.3% Change)
6. Change in Short Contracts: Decreased by 471 contracts (-2.2% Change)

Currency Pair:

1. Overall Non-Commercial Net Bias: Neutral (Slightly Bearish)
2. Rationale: While both currencies show a net long position from non-commercial traders, the decreasing net long position in Gold combined with a decreasing net long position in USD suggests a potential shift in sentiment towards a more neutral or slightly bearish outlook for XAUUSD. This interpretation is supported by the decreasing open interest in both Gold and USD, indicating a reduction in speculative activity.

Potential Market Implications:
The decreasing net long positions in both gold and USD, alongside decreasing open interest, suggests a potential shift in speculative sentiment towards a more neutral or slightly bearish outlook for XAUUSD. This could lead to:

1. Directional Bias: The decreasing bullish sentiment could translate into weaker upward pressure or even a potential downward correction for XAUUSD, especially if this trend continues.
2. Volatility Considerations: The decreasing open interest indicates a potential reduction in speculative trading activity, which could lead to lower volatility in the short term. However, this could also set the stage for a more significant price move if a catalyst emerges.
3. Market Depth: A sustained decrease in open interest could signal weakening market depth, potentially leading to wider spreads and increased price volatility.

Noteworthy Developments:

1. The significant decrease in the net long positions for both gold and USD within a week warrants close monitoring.
2. A continued decline in open interest could indicate a waning bullish conviction, increasing the likelihood of further downward pressure on XAUUSD.

B: Commercial (Hedging) Sentiment:
Key Individual Currency Sentiment:
GOLD (XAU):

1. Commercial Net Position: Net Short (-59.6% of OI)
2. Changes in Net Position: Increased from the previous week
3. Open Interest Trend: Relatively Stable
4. Commercial Long Contracts: Decreased by 1,244 contracts (-1.5% Change)
5. Commercial Short Contracts: Decreased by 6,664 contracts (-1.9% Change)

US DOLLAR (USD):

1. Commercial Net Position: Net Short (-17.4% of OI)
2. Changes in Net Position: Increased from the previous week
3. Open Interest Trend: Relatively Stable
4. Commercial Long Contracts: Increased by 266 contracts (4.3% Change)
5. Commercial Short Contracts: Increased by 744 contracts (6.2% Change)

Net Bias for XAUUSD:

1. Overall Commercial Net Bias: Bullish
2. Rationale: Commercial traders are increasing their net short position in USD while only slightly increasing their net short position in gold. The relatively larger increase in the USD short position suggests a bullish bias towards XAUUSD from a commercial perspective.

Potential Market Implications:
The increasing net short position in USD from commercial traders, a group often considered more informed, suggests potential underlying strength in gold against the US dollar. This divergence in positioning between commercial (bullish) and non-commercial (neutral/slightly bearish) traders creates an interesting dynamic to observe in the coming weeks.

Trading Recommendations (Optional):
Given the conflicting signals between non-commercial and commercial positioning, caution is advised. Traders may consider:

1. Wait-and-See Approach: Monitor future COT reports and price action to identify a clearer trend confirmation.
2. Technical Analysis: Look for confluence with technical indicators to support trading decisions. A break above/below key support/resistance levels, for example, could present a trading opportunity.
3. Fundamental Analysis: Consider the impact of upcoming economic data releases (e.g., inflation, interest rate decisions) and geopolitical events that could influence the USD and gold, and thus, XAUUSD.

C: Final Bias Assessment for XAUUSD
This section integrates the net bias data from Sections A (Non-Commercial) and B (Commercial) to determine the overall bias for the XAUUSD currency pair.

1. Non-Commercial Bias: Net Long (USD) and Net Long (XAU) - Neutral/Slightly Bearish (XAUUSD)
2. Commercial Bias: Net Short (USD) and Net Short (XAU) - Bullish (XAUUSD)

Reconciliation and Final Bias Assessment:

1. Agreement/Disagreement: The commercial and non-commercial biases for XAUUSD disagree. Non-commercial traders show a weakening bullish to neutral stance, while commercial traders are exhibiting a bullish bias.
2. Bias Strength: Non-commercial traders have a weak bearish bias based on the decreasing net long positions in both USD and Gold, whereas commercial traders present a moderate bullish bias.

Conflicting Signals: The conflicting signals require a closer examination of potential drivers:

1. Historical Performance: Historically, commercial traders in XAUUSD have often been more accurate in predicting price trends, although no indicator is perfect.
2. Market Volatility: Volatility is currently low based on decreasing open interest, but this could change rapidly given economic uncertainty and geopolitical risks.
3. Open Interest Trends: The decreasing open interest, primarily driven by non-commercial traders, suggests declining speculative activity, which could give more weight to the commercial traders' sentiment.
4. Sentiment Analysis: The overall market sentiment, gleaned from news and analyst opinions, should be considered in conjunction with COT data to gauge the prevailing market psychology.

Final Net Bias for XAUUSD:
Overall Bias: Mixed, but with a potentially stronger bullish influence from commercial traders.
Rationale for Mixed Bias:

1. Conflicting Signals: While non-commercial traders are decreasing their long positions in both gold and USD, commercial traders are increasing their net short position in USD at a greater rate than their net short position in gold, indicating a bullish bias for XAUUSD.
2. Weighing the Evidence: The moderate bullish bias from commercial traders, known for their longer-term outlook, is considered more influential than the weakening bullish sentiment from non-commercial traders. The historical accuracy of commercial traders in the gold market further strengthens this view.
3. Impact of Extreme Positioning: Neither group exhibits extreme net positioning that would signal an imminent reversal. However, monitoring for potential extremes is essential as markets evolve.

Trading Recommendations:

1. Cautious Bullish Stance: Consider a cautiously bullish outlook on XAUUSD, aligning with the commercial traders' sentiment. However, the mixed signals necessitate a data-driven approach.
2. Technical Confirmation: Wait for a confirmed break above key resistance levels on the XAUUSD chart before entering long positions. Use appropriate risk management tools, such as stop-loss orders, to protect against downside risk.
3. Monitor Fundamentals: Pay close attention to economic data releases, central bank announcements (especially from the Federal Reserve), and geopolitical developments that could impact the USD or gold, ultimately influencing the direction of XAUUSD.
4. Future COT Reports: Continue to monitor future COT reports for any shifts in positioning and open interest. Significant changes in commercial trader behavior could signal a change in the underlying trend.

Disclaimer: This analysis is based solely on COT data and does not consider other market factors. Use this information at your own discretion and with thorough risk management.

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COT Net Bias Analysis for EUR/NZD - Week Ending June 11, 2024

A: Non-Commercial (Speculative) Sentiment:

Key Individual Currency Sentiment:
EURO (EUR):

1. Net Position: Net Long
2. Bias Strength (% of OI): 6.1%
3. Change in Net Position: Increased by 21,706 contracts (49.7% Change)
4. Open Interest Trend: Increasing
5. Change in Long Contracts: Decreased by 1,260 contracts (-0.7% Change)
6. Change in Short Contracts: Increased by 22,966 contracts (18.9% Change)

NZ DOLLAR (NZD):

1. Net Position: Net Long
2. Bias Strength (% of OI): 16.8%
3. Change in Net Position: Increased by 3,773 contracts (52.1% Change)
4. Open Interest Trend: Increasing
5. Change in Long Contracts: Increased by 3,585 contracts (16.8% Change)
6. Change in Short Contracts: Decreased by 188 contracts (-0.5% Change)

Currency Pair:

1. Overall Non-Commercial Net Bias: Neutral (Slightly Bearish)
2. Rationale: While both EUR and NZD show net long positions from non-commercial traders, the increase in the net long EUR position is driven by a large jump in short contracts, suggesting potential weakness in the euro. This, combined with a more balanced increase in the NZD net long position, hints at a possible shift towards a slightly bearish outlook for EUR/NZD. The increasing open interest in both currencies indicates growing market participation but doesn't offer a clear directional bias.

Potential Market Implications:
The surge in short contracts for EUR despite an overall increase in net long positions raises caution. This, coupled with the increasing net long positions in NZD, could imply:

1. Directional Bias: A potential weakening of the EUR against the NZD, pushing EUR/NZD downwards. However, the overall bias remains relatively neutral due to the existing net long positions in both currencies.
2. Volatility Considerations: The combination of increasing open interest and a shift towards short positions in EUR might result in heightened volatility for EUR/NZD.
3. Market Depth: Increasing open interest suggests improving market depth, potentially leading to tighter spreads and smoother trade execution.

Noteworthy Developments:

1. The significant increase in EUR short contracts by non-commercial traders, despite a net long position, is unusual and warrants attention. It suggests underlying bearish sentiment towards the EUR.
2. The simultaneous increase in net long positions and open interest for both currencies reflects heightened market activity and possibly conflicting opinions about the future direction of EUR/NZD.

B: Commercial (Hedging) Sentiment:

Key Individual Currency Sentiment:
EURO (EUR):

1. Commercial Net Position: Net Short (-13.0% of OI)
2. Changes in Net Position: Decreased from the previous week
3. Open Interest Trend: Relatively Stable
4. Commercial Long Contracts: Increased by 25,583 contracts (6.7% Change)
5. Commercial Short Contracts: Decreased by 858 contracts (-0.2% Change)

NZ DOLLAR (NZD):

1. Commercial Net Position: Net Short (-17.8% of OI)
2. Changes in Net Position: Decreased from the previous week
3. Open Interest Trend: Relatively Stable
4. Commercial Long Contracts: Increased by 5,923 contracts (31.0% Change)
5. Commercial Short Contracts: Increased by 9,964 contracts (37.1% Change)

Net Bias for EUR/NZD:

1. Overall Commercial Net Bias: Neutral (Slightly Bullish)
2. Rationale: Commercial traders are decreasing their net short positions in both EUR and NZD. However, the magnitude of the change is more substantial for EUR than NZD, hinting at a potential strengthening of EUR relative to NZD.

Potential Market Implications:
The reduction in the net short positions of commercial traders for both currencies indicates a potential shift in sentiment. The more significant change for EUR compared to NZD suggests that:

1. The EUR might be poised for a short-term strengthening phase against the NZD.
2. The overall neutral stance with a slight bullish tilt implies that the potential upward movement of EUR/NZD might be limited.

Trading Recommendations (Optional):
The conflicting signals from non-commercial and commercial positioning suggest a period of uncertainty for EUR/NZD. Consider these strategies:

1. Range-Bound Trading: The mixed signals from COT data and potential for volatility suggest that EUR/NZD might trade within a range in the short term. Traders could look for opportunities to buy at the lower end of the range and sell at the higher end.
2. Technical Analysis: Employ technical indicators to identify potential entry and exit points. Look for breakouts from established trading ranges, candlestick patterns, or momentum shifts to guide your decisions.
3. Fundamental Analysis: Closely monitor economic releases and central bank announcements for both the Eurozone and New Zealand, as they can significantly impact the direction of the currency pair.

C: Final Bias Assessment for EUR/NZD
This section synthesizes the insights from both non-commercial and commercial positioning to provide a comprehensive net bias assessment.

1. Non-Commercial Bias: Net Long (EUR) and Net Long (NZD) - Neutral (Slightly Bearish)
2. Commercial Bias: Net Short (EUR) and Net Short (NZD) - Neutral (Slightly Bullish)

Reconciliation and Final Bias Assessment:

1. Agreement/Disagreement: There's no clear agreement between commercial and non-commercial biases for EUR/NZD. Both groups present a largely neutral stance with slight opposing tilts.
2. Bias Strength: Both commercial and non-commercial biases are relatively weak, making it challenging to ascertain a definitive directional bias. The conflicting signals and slight tilts in opposite directions highlight the uncertainty surrounding EUR/NZD.

Conflicting Signals: The lack of a clear consensus necessitates a deeper analysis:

1. Historical Performance: Consider which group (commercial or non-commercial) has historically been a more reliable predictor of EUR/NZD price movements.
2. Open Interest Trends: The simultaneous increase in open interest for both currencies, while not indicative of direction, reflects increasing market participation and potential for heightened volatility.
3. Market Sentiment: Analyze the prevailing market sentiment towards the EUR and NZD based on news, economic forecasts, and geopolitical factors. Integrate this sentiment analysis with the COT data to form a more comprehensive view.

Final Net Bias for EUR/NZD:

Overall Bias: Neutral
Rationale for Neutral Bias:

1. Conflicting Signals: The opposing albeit slight biases from non-commercial (slightly bearish) and commercial traders (slightly bullish) create a neutral overall bias.
2. Lack of Conviction: Neither group exhibits a strong bias, and the changes in positions are not substantial enough to suggest a significant shift in sentiment.
3. Open Interest Interpretation: While open interest is increasing, indicating greater market participation, it doesn't provide clarity on the directional bias.

Trading Recommendations:

1. Caution Advised: Given the neutral bias and conflicting signals, a cautious approach to trading EUR/NZD is recommended.
2. Consider Range Trading: Look for opportunities to capitalize on potential price fluctuations within a defined range. Identify key support and resistance levels using technical analysis to establish boundaries for this range.
3. Wait for Confirmation: Before taking significant positions, wait for a clearer confirmation of trend direction, which might emerge from upcoming economic releases, central bank decisions, or a decisive shift in COT data.
4. Fundamental Analysis is Key: Given the lack of a clear directional bias from COT data, conducting thorough fundamental analysis is crucial. Assess the relative economic strengths and weaknesses of the Eurozone and New Zealand, along with factors influencing their respective currencies, to gain a more informed perspective on EUR/NZD.

Disclaimer: This analysis is based solely on COT data and does not consider other market factors. Use this information at your own discretion and with thorough risk management.

[quote=MwlRCT;14902656]{quote} = COT Net Bias Analysis for EUR/NZD - Week Ending June 11, 2024
Much appreciated

As per COT, EUR/NZD still pushing downwards, Lets wait market open to monitor PA.