Super interesting COT Report in my opinion! Look I’m going to be talking my position so not balanced reporting if something is negative I’m not seeing it.
Going from left to right.
- Commercials took full advantage of position liquidation by going aggressively long and reducing short positions +11,000Contracts.
- Swap dealers balancing out net zero Unusual
- Managed money some trend follower’s initiating short positions and some long liquidation. Net position long 19m ridiculously low coming from 70m tons of buying power. If fundamentals take a very positive turn I could see this position grow to 100m net long!
- Large traders. Traders with reportable positions not managing money. Decisions to long and short based on a variety of approches but favoring fundamental analysis. Since November 23 the longs have increased their positions 3m contracts and shorts have reduced 3 m contracts. Net positions up 6 m contracts.
- Small traders first time I’ve seen them almost balanced long only 1 m contracts. Longs handily outweighing shorts
To recap coffee dropping on the back of the stockmarket fueled by get me out liquidation and commercials stepping up recognizing value prices. The only sellers initiating positions are trend followers reacting to system trend signals. It doesn’t seem they will get anywhere unless commercials-step aside. This is where you have to ask yourself can we get prices trending lower based on the present fundamentals? I don’t think so. But we are at a critical juncture. If the market can show us some strength and convince traders that this consolidation can possibly be resolved to the upside a ton of buying exists on the sidelines. A weather market is making analysis more difficult in the short term. We’ve been in a range for 6 months exercising a bit more patience is wise. The move out of this range will be large. And if we can get above 78 highs it will be historic. Want to point out coffee trading on the back of the financials is silly only happening because of the power the coffee cartel has and the bots. Producers are a zero. With coffee’ s fundamentals it should stand on its own 2 feet like cotton or the grains!
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