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Posted by Tango
on July 20, 2019, 11:29 am
This week’s COT shows a role reversal by all the sectors. Most significantly, funds are not buyers and it seems that the number of funds that bought in the previous report liquidated and reversed. Commercials, large traders and swap dealers all became buyers. Swap dealers and small traders covered shorts but it’s worth nothing that the buyers were mostly all new. The market was down 1.90 cents, to close at 105.55, for the period with a range of 6.20 cents and an increase in OI of 6,321 lots. The remainder of the week the OI was slightly higher on Wednesday and higher on Thursday for a total increase of 2,670 lots. The net price change for the remainder of the week and including Friday was +1.75.
The market continued moving sporadically without showing much direction making it what appears to be ideal for day traders. The fact that funds completely reversed is a surprise and a reversal of what they have been doing for some time. Of the 129 funds active, which is a considerable smaller number that we have seen for quite some time, not all have the same strategies and objectives. But it seems that there are plenty of buyers on dips as well, including commercials. Whether the pattern will be continued is of course unknown.
Looking ahead, cold weather or not, the market seems to be defining itself. For now jerky movements will be the norm it appears.