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COT Report: Analysis and Talking Points

  • Gold Bulls Soar to 1yr Highs
  • Hedge Funds Continue to Liquidate Brent Oil Longs
  • Copper Shorts Highest on Record

The Predictive Power of the CoT Report

Gold: As Federal Reserve rate cut bets continue to rise with US bond yields on the decline, gold has regained its allure with gross longs in the precious metal soaring, while gross shorts were slashed, resulting in an 84.7k lot increase in bullish bets. As such, net long positioning in gold is now at the highest level since April 2018 with the ratio of long/short positioning jumping to 3:1 from 1.35:1.

Oil: A further liquidation in gross longs, declining by 50.8k lots, which in turn sees net contracts at 304,327 lots (Prev. 352,736 lots). Consequently, the ratio of long/short positioning has continued to decline, now at 7.45:1 as traders grow cautious over the outlook for oil prices. As highlighted last week, given that gross longs remain notably higher than gross shorts, there is a risk of a further liquidation.

Copper: Hedge Funds continued to add to bearish copper bets with gross shorts rising to record highs at 91.5k lots with sentiment over the global economic outlook remaining fragile. That said, given that there is little to suggest that a trade deal between the US and China will be made in the short-term there is a risk that copper bears will persist, thus keeping a lid on any relief rallies.

Gold Bulls Soar, Copper Shorts at Record High, Oil Longs Decline - COT ReportGold Bulls Soar, Copper Shorts at Record High, Oil Longs Decline - COT ReportGold Bulls Soar, Copper Shorts at Record High, Oil Longs Decline - COT ReportGold Bulls Soar, Copper Shorts at Record High, Oil Longs Decline - COT ReportGold Bulls Soar, Copper Shorts at Record High, Oil Longs Decline - COT ReportGold Bulls Soar, Copper Shorts at Record High, Oil Longs Decline - COT ReportGold Bulls Soar, Copper Shorts at Record High, Oil Longs Decline - COT ReportGold Bulls Soar, Copper Shorts at Record High, Oil Longs Decline - COT Report

FX COT REPORT

EUR and JPY Shorts Cut as USD Bulls Scale Back

KEY TRADING RESOURCES:

--- Written by Justin McQueen, Market Analyst

To contact Justin, email him at Justin.mcqueen@ig.com

Follow Justin on Twitter @JMcQueenFX