possess any interest in making use of the underlying currency or commodity, such as hedge funds, brokerage firms, investment banks and other related firms. With those two moves, by using the COT report as a market sentiment reversal indicator, you could have grabbed a total of 3,500 pips. By examining the COT report, we can have a good idea of the attitude of major traders toward the USD, but to make real use of the the data we must create a portfolio of currency pairs, such as AUD/USD, EUR/USD, USD/JPY. Courtesy of cftc, it may be helpful to think of the. For instance, we will short AUD/USD and EUR/USD (and the carry is negative) and long USD/JPY and then we will manage our currency pair ratios in such a way that the total interest received will not exceed the Fed rate. As the value of the net short positions of non-commercial traders (the green line) dropped, so did EUR/USD. By visually seeing the COT data in this way we can extract useful information, which then provides the basis for our COT Report forex strategy. The other point which we would like to emphasize is the lagged nature of the report. And one can go on with this method, to create an interest-neutral portfolio in the previously described way, thereby limiting the volatility of the position, and ensuring a more successful long-term strategy.
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The, cOT (commitment of traders) is a report issued starfishfx binary options by cftc to update the public on the futures positioning of traders in commodities markets. When looking at COT data, start with at least a 10 year chart for picking out extreme levels. Lets look at another example, and see how the COT data could have aided in making a trading decision. Commercials include importers or exporters who are hedging foreign currency exposure to control costs or normalize income. Over the years the, cOT report has become quite a popular tool for all kinds of traders. This report also helps traders by providing 52-week percentiles of major moves so you can see if were currently at annual bullish / bearish extremes so that you should be tightening stops or looking for price action to confirm the funds are selling out. Speculators are the people on the other side of the Commercials transactions. COT Report Forex Trading Extreme Levels Can Indicate a Reversal When speculators are accumulating a position it can be a confirmation that there is interest in the trend. The extreme COT alerts us to a possible trade (or to avoid a trade) but it doesnt signal a trade.
Forex trading cot report