The Commitments of Traders Bible How To Profit from Insider Market Intelligence

by Briese, Stephen

• ISBN13: 9780470178423
• ISBN10: 0470178426
• Edition: 1st
• Format: Hardcover
• Copyright: 2008-04-04
• Publisher: Wiley

Summary

The foremost analyst of Commitments of Traders data, Steve Briese describes in his new book exactly how he uses the data to analyze market movements and identify turning points in the futures market. Under the rules of the Commodity Futures Trading Commission, large positions must be reported by different categories of traders. Typically, the CoT data represents 70-90 percent of market activity in any particular futures markets. By carefully analyzing the positions of large traders, Briese shows readers how to understand exactly who is buying, who is selling, and who is standing on the sidelines. Armed with this knowledge, a trader or analyst can much more easily identify when market sentiment is changing and - in so doing - spot big profit opportunities. The book describes exactly how CoT works and how it has been traditionally used and misused. Briese discusses the predictive power of CoT data - both from his own experience and in light of studies done by academics. Most importantly, Briese provides readers with his own hard-won insights about CoT patterns in different markets and how each market typically has its own idiosyncrasies. He includes a large appendix that will allow traders to compare contemporary CoT charts with historic CoT charts and thereby gain a sense of where the market might be headed.

Author Biography

Stephen Briese is the leading expert on analyzing the Commitments of Traders data published by the Commodity Futures Trading Commission. Briese has published a newsletter, Bullish Review, since 1988 and has written articles for several industry publications and spoken at a variety of industry trading and technical analysis conferences.

Table of Contents

List Of Illustrations

List Of Tables

Preface

Acknowledgments

Introduction

The COT -Assorted History

The Grain Futures Administration

The Commodity Exchange Authority

The Commodity Futures Trading Commission

The Modern COT Data

COT Futures & Options Combined Report

COT-Supplemental Commodity Index Trader Report

COT Reports -Counting 1, 2, 3 ... The Long Form

The Short Form

COT-Supplemental Commodity Index Report

Player Introductions

Sizing Them Up

The Reporting System

Commercial Hedgers

Large Speculators

Commodity Index Traders

Small Traders

Fading Small Speculators And Other Half-Baked Schemes

TIP: Always Follow Commercials

TIP: Net Long Is Bullish; Net Short Bearish

TIP: Always Fade The Small Speculator

TIP: It Is Only Logical To Compare Hedging To The Seasonal Average

TIP: The COT Is Old News By The Time It Is Released

Net Positions

Open Interest

Constructing Net Positions Charts

Large Speculator Patterns

Commercial Patterns

Small Trader Patterns

Commodity Index Traders

The COT

Index

Calculating The COT

Index

Alternative Look-Back Periods

The COT Index As The Great Normalizer

Interpreting The COT

Index

Heal Thyself

COT Movement

Index

Commercial Movement

Index 40-Point COT Surge Rules (Commercials)

Combining The Indexes

Fund Movement

Index

View From The Gallery

Keynes Theory Of Normal Backwardation

Can Speculators Forecast Prices Houthakker, 1957

Returns To Speculators And The Theory Of Normal Backwardation

Returns To Individual Traders Of Futures: Aggregate Results Hartzmark 1987

Luck Versus Forecast Ability: Determinants Of Trader Performance In Futures Markets Hartzmark 1991

The Returns And Forecasting Ability Of Large Traders In The Frozen Pork Bellies Futures Market Leuthold, Garcia Lu. 1994

Hedging Pressure Effects In Futures Markets

Hedging Demand And Foreign Exchange Risk

Investor Sentiment And Return Predictability In Agricultural Futures Markets Wang 2001

The Behavior And Performance Of Major Types Of Futures Traders Wang 2003

Exchange Rate Changes And Net Positions Of Speculators In The Futures Market

The Profitability Of Speculators In Currency Futures Markets And Manners 2004)

Summary

View From The Pits

The Study Data

The Trading Rules

Trading Rules Test Results

Trading System Considerations

Chart Pattern Validation

A Brief Charting Primer

Bottom Formations

Top Formations

Continuation Patterns

Getting Technical

COT-Stochastics

COT MACD-Histogram

COT-RSI

Standard Deviation (Bollinger) Bands

Conclusions

Breaking Down The COT Report

Crossing Currencies

Commercials

U.S. Dollar

Index

Charts And Correlation Tables

Taking Stock

The COT Beats The Averages

Stock Index Charts And Correlation Tables

Test Of Metal

Golden Opportunities

The Gold/Silver Ratio

The Copper Caper

Commercials

Metal Charts And Correlation Tables

Oil's Slick

Barons Of The Oil Pit

To An Uninterrupted Gasoline Supply

Commercial Hedgers

Historica

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