Financial News

Archive for Financial News – Page 166

Trade of the Week: GBPUSD in for an early-Christmas cracker?

GBPUSD has climbed about 4.9% so far in 2023
UK, US economic data to offer clues on BOE vs. Fed’s 2024 rates plan
Forecasted trading range: 1.2528 – 1.2788

Sterling is the second-best performing G10 currency against the US dollar so far in 2023.

At the time of writing, GBPUSD has about 4.9% in year-to-date gains, albeit with a couple of weeks left to go in the year.

The fact that Sterling is stronger against the US dollar so far this year is somewhat remarkable, in light of the UK’s ongoing economic woes.

Still, amid thinning market activity in this year-end period, traders are set to determine whether the year-to-date gains for “cable” (nickname for GBPUSD) will be extended, or thinned out, before 2023 officially comes to a close.

Events Watchlist

GBPUSD traders are set to react to these UK and US economic data to be released later this week:

Wednesday, Dec 20th: UK November consumer price index (CPI) – which measures inflation
Thursday, Dec 21st: US 3Q GDP (final print)
Friday, Dec 22nd: UK November retail sales and 3Q GDP (final print)
Friday, Dec 22nd: US PCE Deflator – the Federal Reserve’s preferred way of measuring inflation

For the market’s forecasts for each of the above data points, please refer to the FXTM Economic Calendar.

Why is the economic data important to GBPUSD traders?

Note that traders tend to boost the currency of the country that has higher interest rates.

Hence, markets will be using the data to anticipate what the Bank of England and the Federal Reserve might do to their respective interest rates in 2024.

Recall that, just last week, the Bank of England (BOE) threatened to keep its bank rate higher for longer, which is already at a 15-year high of 5.25%, with the UK central bank apparently still not yet done with its fight against inflation.

In contrast, also last week, the Federal Reserve a.k.a the Fed had forecasted that it will be cutting US interest rates in 2024.

Hence, no surprise that the Pound is about 0.9% stronger against the US dollar since this time last week (Dec 11th).

Potential Scenarios:

GBPUSD could be pushed higher if:

the UK inflation data comes in above market forecasts, justifying the BOE’s bias for keeping its bank rate “higher for longer”.
post-CPI gains for GBPUSD would have to be sustained by better-than-expected UK retail sales and GDP figures.
US 3Q GDP remains resilient while the PCE Deflators continue to ease lower, allowing the Fed to cut rates in 2024

However, GBPUSD could be dragged lower by:

a surprise uptick in the US PCE Deflators that threatens the Fed’s plans to lower US interest rates next year
lower-than-expected UK inflation data, retail sales, and GDP figures that once again highlight the risk of the UK economy falling into a recession.
The greater the damage to the UK economy, the less likely the BOE can afford to sustain its bank rate at this current 5.25% level.

NOTE: Higher interest rates are intended to cool down inflation by destroying demand in an economy. However, interest rates that are too high for too long risks sending an economy into a recession.

Key levels

The Bloomberg FX model forecasts a 75% chance that GBPUSD will trade between 1.2528 and 1.2788 this week.

Those levels serve as the general boundaries for GBPUSD’s expected trading range in this week leading up to Christmas.

Within that range, here are some key levels to look out for:

POTENTIAL RESISTANCE

1.27335: November 29th intraday high
1.27607: 38.2 Fibonacci level from GBPUSD’s long-term (June 2021 till September 2022) descent
1.27943: Dec 14th intraday high

POTENTIAL SUPPORT

21-day simple moving average (SMA)
200-day SMA

Article by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Financial News Forex and Currency News

18 Dec

EUR/USD Finds Stability

By RoboForex Analytical Department

On Monday, the EUR/USD pair is demonstrating stability, trading around the 1.0910 mark.

Last week was notable for the currency markets, as key financial updates were released. The Federal Reserve and the European Central Bank maintained their interest rates at 5.50% and 4.50% per annum, respectively. In the U.S., retail sales in November saw a modest increase of 0.3% month-on-month, following a decline in the previous month. Industrial production also showed growth, albeit slightly below expectations at 0.2%, compared to the anticipated 0.3%. This was a slight rebound from October’s decrease of 0.9%.

A significant development was the decline in the U.S. production PMI for December, which fell to 48.2 points, indicating potential concerns over high inflation levels.

With most critical data released, the currency market is now poised for a period of relative stability as it heads towards the Christmas season.

EUR/USD technical analysis

The EUR/USD H4 chart shows that the pair has established a consolidation range around 1.0888. Following an upward breakout, the price hit a local high of 1.1008 before correcting back to 1.0888 (testing from above). A new upward movement towards 1.1050 could initiate today. Upon reaching this level, a downward trend to 1.0727 may begin. The MACD indicator supports this view, with its signal line positioned above zero and pointing upwards.

On the EUR/USD H1 chart, the pair has finished its correction, bouncing off 1.0888. A rising structure is forming towards 1.0970, which could extend to 1.1050. Once this level is reached, a downward movement towards the first target of 1.0725 might ensue. This technical scenario is backed by the Stochastic oscillator, which shows its signal line above 80 and indicates potential further rises to new highs.

Disclaimer

Any forecasts contained herein are based on the author’s particular opinion. This analysis may not be treated as trading advice. RoboForex bears no responsibility for trading results based on trading recommendations and reviews contained herein.

Financial News Forex and Currency News

17 Dec

COT Metals Charts: Speculator Bets led by Platinum & Palladium

By InvestMacro

Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday December 12th and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets.

Weekly Speculator Changes led by Platinum & Palladium

The COT metals markets speculator bets were lower this week as just two out of the six metals markets we cover had higher positioning while the other four markets had lower speculator contracts.

Leading the gains for the metals was Platinum (2,576 contracts) with Palladium (614 contracts) also showing a positive week.

The markets with declines in speculator bets for the week were Gold (-15,311 contracts), Silver (-7,845 contracts), Copper (-2,010 contracts) and Steel (-318 contracts).

Data Snapshot of Commodity Market Traders | Columns Legend

Dec-12-2023	OI	OI-Index	Spec-Net	Spec-Index	Com-Net	COM-Index	Smalls-Net	Smalls-Index
Gold	469,939	22	188,233	60	-212,808	42	24,575	46
Silver	134,281	25	28,458	59	-47,496	36	19,038	72
Copper	176,034	23	-4,004	29	5,131	76	-1,127	11
Palladium	21,309	72	-10,638	6	10,920	97	-282	25
Platinum	74,004	62	7,709	33	-11,713	69	4,004	22

Strength Scores led by Steel & Gold

COT Strength Scores (a normalized measure of Speculator positions over a 3-Year range, from 0 to 100 where above 80 is Extreme-Bullish and below 20 is Extreme-Bearish) showed that Steel (98 percent) and Gold (60 percent) lead the metals markets this week. Palladium (6 percent) comes in as the next highest in the weekly strength scores.

On the downside, Palladium (6 percent) comes in at the lowest strength level currently and is in Extreme-Bearish territory (below 20 percent).

Strength Statistics:
Gold (59.9 percent) vs Gold previous week (66.7 percent)
Silver (58.9 percent) vs Silver previous week (70.1 percent)
Copper (28.5 percent) vs Copper previous week (30.3 percent)
Platinum (33.4 percent) vs Platinum previous week (27.4 percent)
Palladium (5.6 percent) vs Palladium previous week (1.6 percent)
Steel (97.6 percent) vs Palladium previous week (98.8 percent)

Silver & Copper top the 6-Week Strength Trends

COT Strength Score Trends (or move index, calculates the 6-week changes in strength scores) showed that Silver (12 percent) and Copper (12 percent) lead the past six weeks trends for metals.

Platinum (-7 percent) and Palladium (-3 percent) lead the downside trend scores currently.

Move Statistics:
Gold (10.9 percent) vs Gold previous week (23.8 percent)
Silver (11.8 percent) vs Silver previous week (17.1 percent)
Copper (11.8 percent) vs Copper previous week (16.9 percent)
Platinum (-7.2 percent) vs Platinum previous week (13.0 percent)
Palladium (-2.5 percent) vs Palladium previous week (-0.1 percent)
Steel (8.3 percent) vs Steel previous week (20.9 percent)

Individual Markets:

Gold Comex Futures:

The Gold Comex Futures large speculator standing this week reached a net position of 188,233 contracts in the data reported through Tuesday. This was a weekly lowering of -15,311 contracts from the previous week which had a total of 203,544 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 59.9 percent. The commercials are Bearish with a score of 41.8 percent and the small traders (not shown in chart) are Bearish with a score of 45.9 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Gold Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	58.2	22.5	9.9
– Percent of Open Interest Shorts:	18.2	67.8	4.7
– Net Position:	188,233	-212,808	24,575
– Gross Longs:	273,536	105,710	46,457
– Gross Shorts:	85,303	318,518	21,882
– Long to Short Ratio:	3.2 to 1	0.3 to 1	2.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	59.9	41.8	45.9
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	10.9	-11.6	14.7

Silver Comex Futures:

The Silver Comex Futures large speculator standing this week reached a net position of 28,458 contracts in the data reported through Tuesday. This was a weekly fall of -7,845 contracts from the previous week which had a total of 36,303 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 58.9 percent. The commercials are Bearish with a score of 36.4 percent and the small traders (not shown in chart) are Bullish with a score of 72.4 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: New Buy – Long Position.

Silver Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	41.5	28.2	22.8
– Percent of Open Interest Shorts:	20.3	63.6	8.6
– Net Position:	28,458	-47,496	19,038
– Gross Longs:	55,684	37,850	30,602
– Gross Shorts:	27,226	85,346	11,564
– Long to Short Ratio:	2.0 to 1	0.4 to 1	2.6 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	58.9	36.4	72.4
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	11.8	-17.4	34.2

Copper Grade #1 Futures:

The Copper Grade #1 Futures large speculator standing this week reached a net position of -4,004 contracts in the data reported through Tuesday. This was a weekly lowering of -2,010 contracts from the previous week which had a total of -1,994 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 28.5 percent. The commercials are Bullish with a score of 75.9 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 11.4 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: New Buy – Long Position.

Copper Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	37.3	38.9	7.7
– Percent of Open Interest Shorts:	39.6	36.0	8.3
– Net Position:	-4,004	5,131	-1,127
– Gross Longs:	65,630	68,476	13,473
– Gross Shorts:	69,634	63,345	14,600
– Long to Short Ratio:	0.9 to 1	1.1 to 1	0.9 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	28.5	75.9	11.4
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	11.8	-11.0	0.7

Platinum Futures:

The Platinum Futures large speculator standing this week reached a net position of 7,709 contracts in the data reported through Tuesday. This was a weekly gain of 2,576 contracts from the previous week which had a total of 5,133 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 33.4 percent. The commercials are Bullish with a score of 69.3 percent and the small traders (not shown in chart) are Bearish with a score of 21.8 percent.

Price Trend-Following Model: Weak Downtrend (Possible Trend Change)

Our weekly trend-following model classifies the current market price position as: Weak Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

Platinum Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	49.7	28.1	10.3
– Percent of Open Interest Shorts:	39.3	43.9	4.9
– Net Position:	7,709	-11,713	4,004
– Gross Longs:	36,789	20,804	7,620
– Gross Shorts:	29,080	32,517	3,616
– Long to Short Ratio:	1.3 to 1	0.6 to 1	2.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	33.4	69.3	21.8
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-7.2	5.1	8.6

Palladium Futures:

The Palladium Futures large speculator standing this week reached a net position of -10,638 contracts in the data reported through Tuesday. This was a weekly gain of 614 contracts from the previous week which had a total of -11,252 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 5.6 percent. The commercials are Bullish-Extreme with a score of 96.6 percent and the small traders (not shown in chart) are Bearish with a score of 24.8 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

Palladium Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	24.7	59.7	7.8
– Percent of Open Interest Shorts:	74.7	8.4	9.1
– Net Position:	-10,638	10,920	-282
– Gross Longs:	5,270	12,719	1,653
– Gross Shorts:	15,908	1,799	1,935
– Long to Short Ratio:	0.3 to 1	7.1 to 1	0.9 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	5.6	96.6	24.8
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-2.5	4.8	-22.4

Steel Futures Futures:

The Steel Futures large speculator standing this week reached a net position of -485 contracts in the data reported through Tuesday. This was a weekly lowering of -318 contracts from the previous week which had a total of -167 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 97.6 percent. The commercials are Bearish-Extreme with a score of 1.3 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 82.9 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Steel Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	23.5	69.7	3.0
– Percent of Open Interest Shorts:	25.9	69.6	0.6
– Net Position:	-485	23	462
– Gross Longs:	4,671	13,862	587
– Gross Shorts:	5,156	13,839	125
– Long to Short Ratio:	0.9 to 1	1.0 to 1	4.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	97.6	1.3	82.9
– Strength Index Reading (3 Year Range):	Bullish-Extreme	Bearish-Extreme	Bullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	8.3	-9.9	43.0

Article By InvestMacro – Receive our weekly COT Newsletter

*COT Report: The COT data, released weekly to the public each Friday, is updated through the most recent Tuesday (data is 3 days old) and shows a quick view of how large speculators or non-commercials (for-profit traders) were positioned in the futures markets.

The CFTC categorizes trader positions according to commercial hedgers (traders who use futures contracts for hedging as part of the business), non-commercials (large traders who speculate to realize trading profits) and nonreportable traders (usually small traders/speculators) as well as their open interest (contracts open in the market at time of reporting). See CFTC criteria here.

COT Updates Financial News Metals

17 Dec

COT Bonds Charts: Speculator Bets led higher by SOFR 3-Months & 2-Year Bonds

By InvestMacro

Here are the latest charts and statistics for the Commitment of Traders (COT) reports data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday December 12th and shows a quick view of how large traders (for-profit speculators and commercial hedgers) were positioned in the futures markets.

Weekly Speculator Changes led by SOFR 3-Months & 2-Year Bonds

The COT bond market speculator bets were higher this week as five out of the eight bond markets we cover had higher positioning while the other three markets had lower speculator contracts.

Leading the gains for the bond markets was the SOFR 3-Months (206,446 contracts) with the 2-Year Bonds (116,542 contracts), the 5-Year Bonds (89,307 contracts), the 10-Year Bonds (79,525 contracts) and the Ultra Treasury Bonds (23,682 contracts) recording strong positive weeks.

The bond markets with declines in speculator bets for the week were the Ultra 10-Year Bonds (-8,621 contracts), the US Treasury Bonds (-6,180 contracts) and the Fed Funds (-6,043 contracts).

Data Snapshot of Bond Market Traders | Columns Legend

Dec-12-2023	OI	OI-Index	Spec-Net	Spec-Index	Com-Net	COM-Index	Smalls-Net	Smalls-Index
SOFR-3-Months	11,214,870	100	718,226	100	-715,081	0	-3,145	86
FedFunds	1,493,915	45	-159,197	35	172,723	66	-13,526	64
2-Year	3,950,417	89	-1,359,474	7	1,223,113	92	136,361	96
Long T-Bond	1,308,164	62	-136,259	36	100,575	49	35,684	74
10-Year	4,475,716	73	-556,931	28	520,684	68	36,247	81
5-Year	5,737,034	85	-1,340,120	8	1,206,871	91	133,249	96

Strength Scores led by SOFR 3-Months & Ultra Treasury Bonds

On the downside, the Ultra 10-Year Bonds (0 percent), the 2-Year Bonds (7 percent) and the 5-Year Bonds (8 percent) come in at the lowest strength level currently and are in Extreme-Bearish territory (below 20 percent).

Strength Statistics:
Fed Funds (34.5 percent) vs Fed Funds previous week (35.8 percent)
2-Year Bond (7.5 percent) vs 2-Year Bond previous week (0.0 percent)
5-Year Bond (8.2 percent) vs 5-Year Bond previous week (2.5 percent)
10-Year Bond (28.4 percent) vs 10-Year Bond previous week (20.7 percent)
Ultra 10-Year Bond (0.0 percent) vs Ultra 10-Year Bond previous week (1.6 percent)
US Treasury Bond (36.0 percent) vs US Treasury Bond previous week (38.2 percent)
Ultra US Treasury Bond (66.0 percent) vs Ultra US Treasury Bond previous week (56.5 percent)
SOFR 3-Months (100.0 percent) vs SOFR 3-Months previous week (89.0 percent)

SOFR 3-Months & Ultra Treasury Bonds top the 6-Week Strength Trends

COT Strength Score Trends (or move index, calculates the 6-week changes in strength scores) showed that the SOFR 3-Months (25 percent) and the Ultra Treasury Bonds (18 percent) lead the past six weeks trends for bonds. The US Treasury Bonds (7 percent) and the are the next highest positive movers in the latest trends data.

The 5-Year Bonds (-10 percent) and the Ultra 10-Year Bonds (-4 percent) leads the downside trend scores currently.

Strength Trend Statistics:
Fed Funds (4.0 percent) vs Fed Funds previous week (11.3 percent)
2-Year Bond (4.9 percent) vs 2-Year Bond previous week (-3.3 percent)
5-Year Bond (-9.5 percent) vs 5-Year Bond previous week (-26.9 percent)
10-Year Bond (6.9 percent) vs 10-Year Bond previous week (-7.1 percent)
Ultra 10-Year Bond (-4.4 percent) vs Ultra 10-Year Bond previous week (-3.3 percent)
US Treasury Bond (6.7 percent) vs US Treasury Bond previous week (2.1 percent)
Ultra US Treasury Bond (17.6 percent) vs Ultra US Treasury Bond previous week (18.9 percent)
SOFR 3-Months (25.1 percent) vs SOFR 3-Months previous week (12.1 percent)

Secured Overnight Financing Rate (3-Month) Futures:

The Secured Overnight Financing Rate (3-Month) large speculator standing this week came in at a net position of 718,226 contracts in the data reported through Tuesday. This was a weekly increase of 206,446 contracts from the previous week which had a total of 511,780 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 100.0 percent. The commercials are Bearish-Extreme with a score of 0.0 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 86.1 percent.

Price Trend-Following Model: Weak Uptrend (Possible Trend Change)

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

SOFR 3-Months Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	20.8	52.9	0.2
– Percent of Open Interest Shorts:	14.4	59.2	0.3
– Net Position:	718,226	-715,081	-3,145
– Gross Longs:	2,328,164	5,929,211	26,487
– Gross Shorts:	1,609,938	6,644,292	29,632
– Long to Short Ratio:	1.4 to 1	0.9 to 1	0.9 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	100.0	0.0	86.1
– Strength Index Reading (3 Year Range):	Bullish-Extreme	Bearish-Extreme	Bullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	25.1	-25.0	-1.7

30-Day Federal Funds Futures:

The 30-Day Federal Funds large speculator standing this week came in at a net position of -159,197 contracts in the data reported through Tuesday. This was a weekly decrease of -6,043 contracts from the previous week which had a total of -153,154 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 34.5 percent. The commercials are Bullish with a score of 66.4 percent and the small traders (not shown in chart) are Bullish with a score of 64.5 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

30-Day Federal Funds Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	8.7	75.9	2.0
– Percent of Open Interest Shorts:	19.4	64.3	2.9
– Net Position:	-159,197	172,723	-13,526
– Gross Longs:	129,934	1,133,265	30,437
– Gross Shorts:	289,131	960,542	43,963
– Long to Short Ratio:	0.4 to 1	1.2 to 1	0.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	34.5	66.4	64.5
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	4.0	-6.2	20.4

2-Year Treasury Note Futures:

The 2-Year Treasury Note large speculator standing this week came in at a net position of -1,359,474 contracts in the data reported through Tuesday. This was a weekly boost of 116,542 contracts from the previous week which had a total of -1,476,016 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 7.5 percent. The commercials are Bullish-Extreme with a score of 91.9 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 95.8 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

2-Year Treasury Note Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	10.3	81.6	6.6
– Percent of Open Interest Shorts:	44.7	50.6	3.2
– Net Position:	-1,359,474	1,223,113	136,361
– Gross Longs:	405,799	3,222,184	261,377
– Gross Shorts:	1,765,273	1,999,071	125,016
– Long to Short Ratio:	0.2 to 1	1.6 to 1	2.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	7.5	91.9	95.8
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	4.9	-6.4	4.9

5-Year Treasury Note Futures:

The 5-Year Treasury Note large speculator standing this week came in at a net position of -1,340,120 contracts in the data reported through Tuesday. This was a weekly lift of 89,307 contracts from the previous week which had a total of -1,429,427 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 8.2 percent. The commercials are Bullish-Extreme with a score of 90.6 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 95.9 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: New Buy – Long Position.

5-Year Treasury Note Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	8.0	83.5	7.5
– Percent of Open Interest Shorts:	31.4	62.5	5.1
– Net Position:	-1,340,120	1,206,871	133,249
– Gross Longs:	460,211	4,790,468	427,616
– Gross Shorts:	1,800,331	3,583,597	294,367
– Long to Short Ratio:	0.3 to 1	1.3 to 1	1.5 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	8.2	90.6	95.9
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-9.5	7.0	11.8

10-Year Treasury Note Futures:

The 10-Year Treasury Note large speculator standing this week came in at a net position of -556,931 contracts in the data reported through Tuesday. This was a weekly increase of 79,525 contracts from the previous week which had a total of -636,456 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 28.4 percent. The commercials are Bullish with a score of 68.0 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 81.4 percent.

Price Trend-Following Model: Weak Downtrend (Possible Trend Change)

Our weekly trend-following model classifies the current market price position as: Weak Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

10-Year Treasury Note Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	11.5	78.2	8.8
– Percent of Open Interest Shorts:	23.9	66.6	8.0
– Net Position:	-556,931	520,684	36,247
– Gross Longs:	513,976	3,501,136	392,754
– Gross Shorts:	1,070,907	2,980,452	356,507
– Long to Short Ratio:	0.5 to 1	1.2 to 1	1.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	28.4	68.0	81.4
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	6.9	-1.4	-12.9

Ultra 10-Year Notes Futures:

The Ultra 10-Year Notes large speculator standing this week came in at a net position of -276,476 contracts in the data reported through Tuesday. This was a weekly decline of -8,621 contracts from the previous week which had a total of -267,855 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 0.0 percent. The commercials are Bullish-Extreme with a score of 100.0 percent and the small traders (not shown in chart) are Bullish with a score of 74.8 percent.

Price Trend-Following Model: Weak Uptrend (Possible Trend Change)

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Ultra 10-Year Notes Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	10.8	78.4	10.2
– Percent of Open Interest Shorts:	24.8	61.1	13.6
– Net Position:	-276,476	342,405	-65,929
– Gross Longs:	214,045	1,553,719	203,035
– Gross Shorts:	490,521	1,211,314	268,964
– Long to Short Ratio:	0.4 to 1	1.3 to 1	0.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	0.0	100.0	74.8
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-4.4	11.8	-20.7

US Treasury Bonds Futures:

The US Treasury Bonds large speculator standing this week came in at a net position of -136,259 contracts in the data reported through Tuesday. This was a weekly reduction of -6,180 contracts from the previous week which had a total of -130,079 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 36.0 percent. The commercials are Bearish with a score of 48.5 percent and the small traders (not shown in chart) are Bullish with a score of 74.4 percent.

Price Trend-Following Model: Weak Downtrend (Possible Trend Change)

Our weekly trend-following model classifies the current market price position as: Weak Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

US Treasury Bonds Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	9.3	76.2	14.1
– Percent of Open Interest Shorts:	19.7	68.5	11.4
– Net Position:	-136,259	100,575	35,684
– Gross Longs:	121,982	996,728	184,452
– Gross Shorts:	258,241	896,153	148,768
– Long to Short Ratio:	0.5 to 1	1.1 to 1	1.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	36.0	48.5	74.4
– Strength Index Reading (3 Year Range):	Bearish	Bearish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	6.7	-0.2	-13.5

Ultra US Treasury Bonds Futures:

The Ultra US Treasury Bonds large speculator standing this week came in at a net position of -292,980 contracts in the data reported through Tuesday. This was a weekly gain of 23,682 contracts from the previous week which had a total of -316,662 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 66.0 percent. The commercials are Bearish with a score of 32.3 percent and the small traders (not shown in chart) are Bullish with a score of 51.0 percent.

Price Trend-Following Model: Weak Downtrend (Possible Trend Change)

Our weekly trend-following model classifies the current market price position as: Weak Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

Ultra US Treasury Bonds Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	7.3	81.7	10.7
– Percent of Open Interest Shorts:	25.9	64.0	9.8
– Net Position:	-292,980	278,286	14,694
– Gross Longs:	115,577	1,290,226	169,381
– Gross Shorts:	408,557	1,011,940	154,687
– Long to Short Ratio:	0.3 to 1	1.3 to 1	1.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	66.0	32.3	51.0
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	17.6	-14.5	-13.9

Article By InvestMacro – Receive our weekly COT Newsletter

Bonds COT Updates Financial News

17 Dec

COT Stock Market Charts: Speculator Bets led this week by VIX & Russell-Mini

By InvestMacro

Here are the latest charts and statistics for the Commitment of Traders (COT) data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday December 12th and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets.

Weekly Speculator Changes led by the VIX & Russell-Mini

The COT stock markets speculator bets were slightly lower this week as three out of the seven stock markets we cover had higher positioning while the other four markets had lower speculator contracts.

Leading the gains for the stock markets was the VIX (10,461 contracts) with the Russell-Mini (4,800 contracts) and the DowJones-Mini (3,143 contracts) also showing positive weeks.

The markets with the declines in speculator bets this week were the S&P500-Mini (-17,822 contracts), the MSCI EAFE-Mini (-4,851 contracts), the Nikkei 225 (-627 contracts) and the Nasdaq-Mini (-298 contracts) also registering lower bets on the week.

Data Snapshot of Stock Market Traders | Columns Legend

Dec-12-2023	OI	OI-Index	Spec-Net	Spec-Index	Com-Net	COM-Index	Smalls-Net	Smalls-Index
S&P500-Mini	2,670,454	61	-65,083	55	21,495	43	43,588	55
Nikkei 225	14,756	28	-2,317	50	1,807	47	510	45
Nasdaq-Mini	337,236	100	8,104	51	-10,817	31	2,713	90
DowJones-Mini	112,076	85	3,451	88	199	29	-3,650	26
VIX	427,229	86	-46,316	78	45,724	18	592	99
Nikkei 225 Yen	40,280	17	9,714	64	-3,881	1	-5,833	89

Strength Scores led by DowJones-Mini & VIX

COT Strength Scores (a normalized measure of Speculator positions over a 3-Year range, from 0 to 100 where above 80 is Extreme-Bullish and below 20 is Extreme-Bearish) showed that the DowJones-Mini (88 percent) and the VIX (78 percent) lead the stock markets this week. The Nikkei 225 Yen (64 percent) and S&P500-Mini (55 percent) come in as the next highest in the weekly strength scores and above a 50 percent score.

On the downside, the MSCI EAFE-Mini (9 percent) comes in at the lowest strength level currently and is in Extreme-Bearish territory (below 20 percent).

Strength Statistics:
VIX (78.3 percent) vs VIX previous week (71.3 percent)
S&P500-Mini (55.0 percent) vs S&P500-Mini previous week (57.7 percent)
DowJones-Mini (87.6 percent) vs DowJones-Mini previous week (80.8 percent)
Nasdaq-Mini (51.4 percent) vs Nasdaq-Mini previous week (51.9 percent)
Russell2000-Mini (45.3 percent) vs Russell2000-Mini previous week (42.2 percent)
Nikkei USD (50.1 percent) vs Nikkei USD previous week (54.5 percent)
EAFE-Mini (9.3 percent) vs EAFE-Mini previous week (14.1 percent)

DowJones-Mini & Nikkei 225 Yen top the 6-Week Strength Trends

COT Strength Score Trends (or move index, calculates the 6-week changes in strength scores) showed that the DowJones-Mini (85 percent) overwhelmingly leads the past six weeks trends for the stock markets. The Nasdaq-Mini (2 percent) is the next highest positive movers in the latest trends data.

The VIX (-22 percent) leads the downside trend scores currently with the S&P500-Mini (-10 percent) coming in as the next market with lower trend scores.

Strength Trend Statistics:
VIX (-21.7 percent) vs VIX previous week (-23.6 percent)
S&P500-Mini (-10.4 percent) vs S&P500-Mini previous week (-8.6 percent)
DowJones-Mini (85.5 percent) vs DowJones-Mini previous week (78.4 percent)
Nasdaq-Mini (2.1 percent) vs Nasdaq-Mini previous week (8.8 percent)
Russell2000-Mini (-7.3 percent) vs Russell2000-Mini previous week (-7.4 percent)
Nikkei USD (-3.1 percent) vs Nikkei USD previous week (3.1 percent)
EAFE-Mini (-9.1 percent) vs EAFE-Mini previous week (-19.1 percent)

Individual Stock Market Charts:

VIX Volatility Futures:

The VIX Volatility large speculator standing this week totaled a net position of -46,316 contracts in the data reported through Tuesday. This was a weekly rise of 10,461 contracts from the previous week which had a total of -56,777 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 78.3 percent. The commercials are Bearish-Extreme with a score of 17.6 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 99.5 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

VIX Volatility Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	22.8	47.6	7.3
– Percent of Open Interest Shorts:	33.7	36.9	7.2
– Net Position:	-46,316	45,724	592
– Gross Longs:	97,484	203,215	31,240
– Gross Shorts:	143,800	157,491	30,648
– Long to Short Ratio:	0.7 to 1	1.3 to 1	1.0 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	78.3	17.6	99.5
– Strength Index Reading (3 Year Range):	Bullish	Bearish-Extreme	Bullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-21.7	17.6	27.2

S&P500 Mini Futures:

The S&P500 Mini large speculator standing this week totaled a net position of -65,083 contracts in the data reported through Tuesday. This was a weekly fall of -17,822 contracts from the previous week which had a total of -47,261 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 55.0 percent. The commercials are Bearish with a score of 42.9 percent and the small traders (not shown in chart) are Bullish with a score of 54.5 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: New Buy – Long Position.

S&P500 Mini Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	9.6	70.7	11.5
– Percent of Open Interest Shorts:	12.1	69.9	9.8
– Net Position:	-65,083	21,495	43,588
– Gross Longs:	257,533	1,888,239	306,616
– Gross Shorts:	322,616	1,866,744	263,028
– Long to Short Ratio:	0.8 to 1	1.0 to 1	1.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	55.0	42.9	54.5
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-10.4	7.7	5.5

Dow Jones Mini Futures:

The Dow Jones Mini large speculator standing this week totaled a net position of 3,451 contracts in the data reported through Tuesday. This was a weekly boost of 3,143 contracts from the previous week which had a total of 308 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish-Extreme with a score of 87.6 percent. The commercials are Bearish with a score of 28.5 percent and the small traders (not shown in chart) are Bearish with a score of 26.1 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Dow Jones Mini Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	23.2	58.7	12.8
– Percent of Open Interest Shorts:	20.1	58.5	16.0
– Net Position:	3,451	199	-3,650
– Gross Longs:	25,968	65,779	14,302
– Gross Shorts:	22,517	65,580	17,952
– Long to Short Ratio:	1.2 to 1	1.0 to 1	0.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	87.6	28.5	26.1
– Strength Index Reading (3 Year Range):	Bullish-Extreme	Bearish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	85.5	-68.2	4.2

Nasdaq Mini Futures:

The Nasdaq Mini large speculator standing this week totaled a net position of 8,104 contracts in the data reported through Tuesday. This was a weekly lowering of -298 contracts from the previous week which had a total of 8,402 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 51.4 percent. The commercials are Bearish with a score of 30.9 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 89.9 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

Nasdaq Mini Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	21.2	62.9	13.2
– Percent of Open Interest Shorts:	18.8	66.1	12.4
– Net Position:	8,104	-10,817	2,713
– Gross Longs:	71,616	212,001	44,538
– Gross Shorts:	63,512	222,818	41,825
– Long to Short Ratio:	1.1 to 1	1.0 to 1	1.1 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	51.4	30.9	89.9
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	2.1	-5.4	8.2

Russell 2000 Mini Futures:

The Russell 2000 Mini large speculator standing this week totaled a net position of -50,629 contracts in the data reported through Tuesday. This was a weekly boost of 4,800 contracts from the previous week which had a total of -55,429 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 45.3 percent. The commercials are Bullish with a score of 53.2 percent and the small traders (not shown in chart) are Bearish with a score of 49.5 percent.

Price Trend-Following Model: Weak Downtrend (Possible Trend Change)

Our weekly trend-following model classifies the current market price position as: Weak Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

Russell 2000 Mini Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	10.2	80.4	6.2
– Percent of Open Interest Shorts:	18.2	73.6	5.0
– Net Position:	-50,629	43,204	7,425
– Gross Longs:	65,483	513,991	39,542
– Gross Shorts:	116,112	470,787	32,117
– Long to Short Ratio:	0.6 to 1	1.1 to 1	1.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	45.3	53.2	49.5
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-7.3	1.3	27.4

Nikkei Stock Average (USD) Futures:

The Nikkei Stock Average (USD) large speculator standing this week totaled a net position of -2,317 contracts in the data reported through Tuesday. This was a weekly decline of -627 contracts from the previous week which had a total of -1,690 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 50.1 percent. The commercials are Bearish with a score of 46.9 percent and the small traders (not shown in chart) are Bearish with a score of 45.3 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: New Buy – Long Position.

Nikkei Stock Average Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	12.9	66.1	21.0
– Percent of Open Interest Shorts:	28.6	53.8	17.5
– Net Position:	-2,317	1,807	510
– Gross Longs:	1,910	9,748	3,098
– Gross Shorts:	4,227	7,941	2,588
– Long to Short Ratio:	0.5 to 1	1.2 to 1	1.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	50.1	46.9	45.3
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-3.1	4.4	-4.6

MSCI EAFE Mini Futures:

The MSCI EAFE Mini large speculator standing this week totaled a net position of -54,709 contracts in the data reported through Tuesday. This was a weekly decline of -4,851 contracts from the previous week which had a total of -49,858 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 9.3 percent. The commercials are Bullish-Extreme with a score of 89.5 percent and the small traders (not shown in chart) are Bearish with a score of 37.7 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: New Buy – Long Position.

MSCI EAFE Mini Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	5.0	92.0	2.2
– Percent of Open Interest Shorts:	17.0	81.0	1.2
– Net Position:	-54,709	50,564	4,145
– Gross Longs:	22,631	419,808	9,840
– Gross Shorts:	77,340	369,244	5,695
– Long to Short Ratio:	0.3 to 1	1.1 to 1	1.7 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	9.3	89.5	37.7
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-9.1	5.7	16.5

Article By InvestMacro – Receive our weekly COT Newsletter

COT Updates Financial News Stock Market News

17 Dec

COT Soft Commodities Charts: Speculator Bets led higher by Wheat

By InvestMacro

Here are the latest charts and statistics for the Commitment of Traders (COT) reports data published by the Commodities Futures Trading Commission (CFTC).

The latest COT data is updated through Tuesday December 12th and shows a quick view of how large traders (for-profit speculators and commercial entities) were positioned in the futures markets.

Weekly Speculator Changes led by Wheat

The COT soft commodities markets speculator bets were slightly higher this week as six out of the eleven softs markets we cover had higher positioning while the other five markets had lower speculator contracts.

Leading the gains for the softs markets was Wheat (27,046 contracts) with Corn (9,224 contracts), Cotton (7,547 contracts), Coffee (2,308 contracts), Live Cattle (1,300 contracts) and Cocoa (392 contracts) also having positive weeks.

The markets with the declines in speculator bets this week were Sugar (-58,077 contracts), Soybean Meal (-31,907 contracts), Soybean Oil (-7,060 contracts), Lean Hogs (-3,765 contracts) and Soybeans (-2,759 contracts).

Data Snapshot of Commodity Market Traders | Columns Legend

Dec-12-2023	OI	OI-Index	Spec-Net	Spec-Index	Com-Net	COM-Index	Smalls-Net	Smalls-Index
WTI Crude	1,650,245	23	151,599	3	-175,326	98	23,727	28
Gold	469,939	22	188,233	60	-212,808	42	24,575	46
Silver	134,281	25	28,458	59	-47,496	36	19,038	72
Copper	176,034	23	-4,004	29	5,131	76	-1,127	11
Palladium	21,309	72	-10,638	6	10,920	97	-282	25
Platinum	74,004	62	7,709	33	-11,713	69	4,004	22
Natural Gas	1,412,602	90	-111,617	32	88,022	71	23,595	36
Brent	126,671	7	-17,577	78	15,753	24	1,824	37
Heating Oil	302,940	37	27,120	72	-41,287	43	14,167	40
Soybeans	718,648	38	17,539	1	-216	97	-17,323	62
Corn	1,251,100	8	-101,215	8	131,530	94	-30,315	81
Coffee	210,390	25	36,568	65	-38,176	38	1,608	33
Sugar	781,527	21	107,392	29	-129,631	70	22,239	31
Wheat	347,460	35	-40,021	40	48,543	63	-8,522	29

Strength Scores led by Cocoa & Coffee

COT Strength Scores (a normalized measure of Speculator positions over a 3-Year range, from 0 to 100 where above 80 is Extreme-Bullish and below 20 is Extreme-Bearish) showed that Cocoa (79 percent) and Coffee (65 percent) lead the softs markets this week. Soybean Meal (49 percent) comes in as the next highest in the weekly strength scores.

On the downside, Soybeans (1 percent), Lean Hogs (6 percent), Corn (8 percent), Soybean Oil (15 percent) and Cotton (19 percent) come in at the lowest strength levels currently and are in Extreme-Bearish territory (below 20 percent).

Strength Statistics:
Corn (7.9 percent) vs Corn previous week (6.6 percent)
Sugar (29.4 percent) vs Sugar previous week (50.5 percent)
Coffee (64.9 percent) vs Coffee previous week (62.6 percent)
Soybeans (0.5 percent) vs Soybeans previous week (1.6 percent)
Soybean Oil (14.8 percent) vs Soybean Oil previous week (18.9 percent)
Soybean Meal (48.6 percent) vs Soybean Meal previous week (66.4 percent)
Live Cattle (20.7 percent) vs Live Cattle previous week (19.3 percent)
Lean Hogs (6.3 percent) vs Lean Hogs previous week (9.4 percent)
Cotton (19.3 percent) vs Cotton previous week (13.7 percent)
Cocoa (78.6 percent) vs Cocoa previous week (78.2 percent)
Wheat (39.7 percent) vs Wheat previous week (20.9 percent)

Wheat & Coffee top the 6-Week Strength Trends

COT Strength Score Trends (or move index, calculates the 6-week changes in strength scores) showed that Wheat (21 percent) and Coffee (15 percent) lead the past six weeks trends for soft commodities.

Sugar (-38 percent) leads the downside trend scores currently with Soybean Meal (-19 percent), Soybean Oil (-18 percent) and Live Cattle (-12 percent) following next with lower trend scores.

Strength Trend Statistics:
Corn (-1.9 percent) vs Corn previous week (-8.8 percent)
Sugar (-38.4 percent) vs Sugar previous week (-21.4 percent)
Coffee (14.7 percent) vs Coffee previous week (16.5 percent)
Soybeans (0.5 percent) vs Soybeans previous week (-6.3 percent)
Soybean Oil (-17.9 percent) vs Soybean Oil previous week (-17.3 percent)
Soybean Meal (-19.4 percent) vs Soybean Meal previous week (5.7 percent)
Live Cattle (-12.3 percent) vs Live Cattle previous week (-20.9 percent)
Lean Hogs (-8.4 percent) vs Lean Hogs previous week (-3.3 percent)
Cotton (-6.4 percent) vs Cotton previous week (-12.1 percent)
Cocoa (-2.2 percent) vs Cocoa previous week (-10.3 percent)
Wheat (20.5 percent) vs Wheat previous week (-4.9 percent)

Individual Soft Commodities Markets:

CORN Futures:

The CORN large speculator standing this week totaled a net position of -101,215 contracts in the data reported through Tuesday. This was a weekly increase of 9,224 contracts from the previous week which had a total of -110,439 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 7.9 percent. The commercials are Bullish-Extreme with a score of 93.6 percent and the small traders (not shown in chart) are Bullish-Extreme with a score of 80.5 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

CORN Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	21.3	46.8	10.6
– Percent of Open Interest Shorts:	29.4	36.3	13.0
– Net Position:	-101,215	131,530	-30,315
– Gross Longs:	266,655	585,265	132,780
– Gross Shorts:	367,870	453,735	163,095
– Long to Short Ratio:	0.7 to 1	1.3 to 1	0.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	7.9	93.6	80.5
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bullish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-1.9	2.6	-6.3

SUGAR Futures:

The SUGAR large speculator standing this week totaled a net position of 107,392 contracts in the data reported through Tuesday. This was a weekly fall of -58,077 contracts from the previous week which had a total of 165,469 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 29.4 percent. The commercials are Bullish with a score of 69.7 percent and the small traders (not shown in chart) are Bearish with a score of 31.2 percent.

Price Trend-Following Model: Weak Uptrend (Possible Trend Change)

Our weekly trend-following model classifies the current market price position as: Weak Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

SUGAR Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	25.7	52.2	9.5
– Percent of Open Interest Shorts:	11.9	68.8	6.6
– Net Position:	107,392	-129,631	22,239
– Gross Longs:	200,473	408,051	74,109
– Gross Shorts:	93,081	537,682	51,870
– Long to Short Ratio:	2.2 to 1	0.8 to 1	1.4 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	29.4	69.7	31.2
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-38.4	39.5	-29.9

COFFEE Futures:

The COFFEE large speculator standing this week totaled a net position of 36,568 contracts in the data reported through Tuesday. This was a weekly gain of 2,308 contracts from the previous week which had a total of 34,260 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 64.9 percent. The commercials are Bearish with a score of 37.9 percent and the small traders (not shown in chart) are Bearish with a score of 33.3 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

COFFEE Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	31.9	37.5	5.5
– Percent of Open Interest Shorts:	14.5	55.6	4.7
– Net Position:	36,568	-38,176	1,608
– Gross Longs:	67,149	78,878	11,508
– Gross Shorts:	30,581	117,054	9,900
– Long to Short Ratio:	2.2 to 1	0.7 to 1	1.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	64.9	37.9	33.3
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	14.7	-16.2	25.3

SOYBEANS Futures:

The SOYBEANS large speculator standing this week totaled a net position of 17,539 contracts in the data reported through Tuesday. This was a weekly reduction of -2,759 contracts from the previous week which had a total of 20,298 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 0.5 percent. The commercials are Bullish-Extreme with a score of 96.6 percent and the small traders (not shown in chart) are Bullish with a score of 62.3 percent.

Price Trend-Following Model: Weak Downtrend (Possible Trend Change)

Our weekly trend-following model classifies the current market price position as: Weak Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

SOYBEANS Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	15.0	53.5	7.3
– Percent of Open Interest Shorts:	12.6	53.6	9.7
– Net Position:	17,539	-216	-17,323
– Gross Longs:	107,860	384,698	52,732
– Gross Shorts:	90,321	384,914	70,055
– Long to Short Ratio:	1.2 to 1	1.0 to 1	0.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	0.5	96.6	62.3
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	0.5	0.6	-6.9

SOYBEAN OIL Futures:

The SOYBEAN OIL large speculator standing this week totaled a net position of -5,804 contracts in the data reported through Tuesday. This was a weekly lowering of -7,060 contracts from the previous week which had a total of 1,256 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 14.8 percent. The commercials are Bullish-Extreme with a score of 83.0 percent and the small traders (not shown in chart) are Bearish with a score of 32.6 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

SOYBEAN OIL Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	18.6	49.7	6.9
– Percent of Open Interest Shorts:	19.8	49.5	5.9
– Net Position:	-5,804	699	5,105
– Gross Longs:	86,954	232,182	32,465
– Gross Shorts:	92,758	231,483	27,360
– Long to Short Ratio:	0.9 to 1	1.0 to 1	1.2 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	14.8	83.0	32.6
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-17.9	16.1	-0.8

SOYBEAN MEAL Futures:

The SOYBEAN MEAL large speculator standing this week totaled a net position of 84,744 contracts in the data reported through Tuesday. This was a weekly decrease of -31,907 contracts from the previous week which had a total of 116,651 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 48.6 percent. The commercials are Bearish with a score of 49.8 percent and the small traders (not shown in chart) are Bullish with a score of 57.0 percent.

Price Trend-Following Model: Uptrend

Our weekly trend-following model classifies the current market price position as: Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

SOYBEAN MEAL Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	28.3	38.0	10.9
– Percent of Open Interest Shorts:	10.7	60.3	6.2
– Net Position:	84,744	-107,389	22,645
– Gross Longs:	136,307	183,339	52,503
– Gross Shorts:	51,563	290,728	29,858
– Long to Short Ratio:	2.6 to 1	0.6 to 1	1.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	48.6	49.8	57.0
– Strength Index Reading (3 Year Range):	Bearish	Bearish	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-19.4	17.7	15.5

LIVE CATTLE Futures:

The LIVE CATTLE large speculator standing this week totaled a net position of 38,758 contracts in the data reported through Tuesday. This was a weekly advance of 1,300 contracts from the previous week which had a total of 37,458 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 20.7 percent. The commercials are Bullish-Extreme with a score of 81.1 percent and the small traders (not shown in chart) are Bullish with a score of 64.6 percent.

Price Trend-Following Model: Strong Downtrend

Our weekly trend-following model classifies the current market price position as: Strong Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

LIVE CATTLE Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	26.8	38.9	11.4
– Percent of Open Interest Shorts:	12.2	51.8	13.2
– Net Position:	38,758	-34,044	-4,714
– Gross Longs:	71,116	103,176	30,336
– Gross Shorts:	32,358	137,220	35,050
– Long to Short Ratio:	2.2 to 1	0.8 to 1	0.9 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	20.7	81.1	64.6
– Strength Index Reading (3 Year Range):	Bearish	Bullish-Extreme	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-12.3	12.0	8.7

LEAN HOGS Futures:

The LEAN HOGS large speculator standing this week totaled a net position of -28,455 contracts in the data reported through Tuesday. This was a weekly fall of -3,765 contracts from the previous week which had a total of -24,690 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 6.3 percent. The commercials are Bullish-Extreme with a score of 99.7 percent and the small traders (not shown in chart) are Bullish with a score of 63.5 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

LEAN HOGS Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	28.5	40.8	8.5
– Percent of Open Interest Shorts:	43.5	23.5	10.8
– Net Position:	-28,455	32,876	-4,421
– Gross Longs:	54,212	77,622	16,150
– Gross Shorts:	82,667	44,746	20,571
– Long to Short Ratio:	0.7 to 1	1.7 to 1	0.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	6.3	99.7	63.5
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bullish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-8.4	11.5	-11.7

COTTON Futures:

The COTTON large speculator standing this week totaled a net position of 14,104 contracts in the data reported through Tuesday. This was a weekly lift of 7,547 contracts from the previous week which had a total of 6,557 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish-Extreme with a score of 19.3 percent. The commercials are Bullish-Extreme with a score of 80.8 percent and the small traders (not shown in chart) are Bearish-Extreme with a score of 16.3 percent.

Price Trend-Following Model: Downtrend

Our weekly trend-following model classifies the current market price position as: Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

COTTON Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	33.7	44.7	5.6
– Percent of Open Interest Shorts:	26.5	51.9	5.6
– Net Position:	14,104	-14,147	43
– Gross Longs:	66,280	88,023	11,017
– Gross Shorts:	52,176	102,170	10,974
– Long to Short Ratio:	1.3 to 1	0.9 to 1	1.0 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	19.3	80.8	16.3
– Strength Index Reading (3 Year Range):	Bearish-Extreme	Bullish-Extreme	Bearish-Extreme
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-6.4	7.1	-12.0

COCOA Futures:

The COCOA large speculator standing this week totaled a net position of 67,303 contracts in the data reported through Tuesday. This was a weekly lift of 392 contracts from the previous week which had a total of 66,911 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bullish with a score of 78.6 percent. The commercials are Bearish with a score of 21.1 percent and the small traders (not shown in chart) are Bearish with a score of 30.0 percent.

Price Trend-Following Model: Strong Uptrend

Our weekly trend-following model classifies the current market price position as: Strong Uptrend. The current action for the model is considered to be: Hold – Maintain Long Position.

COCOA Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	40.6	27.0	5.5
– Percent of Open Interest Shorts:	17.6	51.2	4.4
– Net Position:	67,303	-70,652	3,349
– Gross Longs:	118,747	79,020	16,150
– Gross Shorts:	51,444	149,672	12,801
– Long to Short Ratio:	2.3 to 1	0.5 to 1	1.3 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	78.6	21.1	30.0
– Strength Index Reading (3 Year Range):	Bullish	Bearish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	-2.2	1.5	7.2

WHEAT Futures:

The WHEAT large speculator standing this week totaled a net position of -40,021 contracts in the data reported through Tuesday. This was a weekly gain of 27,046 contracts from the previous week which had a total of -67,067 net contracts.

This week’s current strength score (the trader positioning range over the past three years, measured from 0 to 100) shows the speculators are currently Bearish with a score of 39.7 percent. The commercials are Bullish with a score of 62.8 percent and the small traders (not shown in chart) are Bearish with a score of 29.1 percent.

Price Trend-Following Model: Weak Downtrend (Possible Trend Change)

Our weekly trend-following model classifies the current market price position as: Weak Downtrend. The current action for the model is considered to be: Hold – Maintain Short Position.

WHEAT Futures Statistics	SPECULATORS	COMMERCIALS	SMALL TRADERS
– Percent of Open Interest Longs:	31.2	38.9	8.1
– Percent of Open Interest Shorts:	42.7	25.0	10.5
– Net Position:	-40,021	48,543	-8,522
– Gross Longs:	108,383	135,276	28,033
– Gross Shorts:	148,404	86,733	36,555
– Long to Short Ratio:	0.7 to 1	1.6 to 1	0.8 to 1
NET POSITION TREND:
– Strength Index Score (3 Year Range Pct):	39.7	62.8	29.1
– Strength Index Reading (3 Year Range):	Bearish	Bullish	Bearish
NET POSITION MOVEMENT INDEX:
– 6-Week Change in Strength Index:	20.5	-14.9	-41.2

Article By InvestMacro – Receive our weekly COT Newsletter

COT Updates Financial News Soft Commodities

12 Dec

Bank of Japan’s statements mislead investors. Oil is expected to see a rise in fuel demand ahead of the holidays

By JustMarkets

As of Monday’s stock market close, the Dow Jones Index (US30) was up by 0.43%, while the S&P 500 Index (US500) added 0.39%. The NASDAQ Technology Index (US100) closed positive by 0.20% yesterday. Stocks found support on Monday on expectations that US consumer prices will continue to decline. Today, the CPI report for November will be released. US CPI is expected to decline to 3.1% y/y from 3.2% y/y in October, while CPI excluding food and energy is expected to remain unchanged at 4.0% y/y.

This week, markets will also keep a close eye on the results of the central bank meetings of the Fed, ECB, SNB, and Bank of England to see if policymakers support the suspension of the interest rate hike campaign and when they might start to shift to a softer policy.

According to Bloomberg Intelligence, 2024 will be a year of strong fundamental growth for stocks of companies that make chips for generative artificial intelligence.

According to the latest polls, Mexico’s central bank (Banxico) is likely to keep its benchmark interest rate unchanged this Friday for the sixth consecutive time at 11.25%, with discussions of a rate cut not starting until next year. Minutes from the bank’s last monetary policy meeting showed the idea of discussing a key interest rate cut in the first quarter of 2024.

Equity markets in Europe traded on Monday without a single dynamic. German DAX (DE40) rose by 0.21%, French CAC 40 (FR40) gained 0.33% yesterday, Spanish IBEX 35 (ES35) declined by 0.25%, and British FTSE 100 (UK100) closed negative by 0.13%. Goldman Sachs raised its 12-month forecast for the STOXX 600 index to 500, implying a nearly 6% gain through the end of 2024 on expectations of lower interest rates. The broker previously expected the index to end 2024 at 480 points. Meanwhile, GS downgraded its recommendation on European banks to “neutral” as it expects the European Central Bank to cut interest rates next year.

Swap prices show that the chances of an ECB rate cut in Q1 2024 have decreased. In swaps tied to ECB meeting dates, the probability that the ECB will cut the benchmark rate by 25 bps at its March 7 meeting is 58%, down from 67% recorded last Friday.

Crude oil prices recovered from early losses on Monday and posted a slight gain after the American Automobile Association (AAA) predicted a record number of air travelers during the Christmas week, which will have a positive impact on fuel demand. AAA predicted that a record 7.5 million people will use air transportation services between December 23 and January 2.

Asian markets were predominantly up yesterday. Japan’s Nikkei 225 (JP225) gained 1.5%, China’s FTSE China A50 (CHA50) added 0.13% on Monday, Hong Kong’s Hang Seng (HK50) fell by 0.81% on the day, and Australia’s ASX 200 (AU200) was positive 0.06%.

Even late last week, the market was dominated by rumors that the Bank of Japan was planning an exit from negative interest rates. But yesterday, BoJ officials said that they see no need to rush to abandon the negative interest rate policy as there is insufficient evidence of wage growth to support sustainable inflation. Such an approach could undermine investor confidence in the yen and the JP225, so the Bank of Japan should be more consistent.

Japan’s BSI Large Manufacturing Business Conditions Index rose from 5.4 to 5.7 in Q3, the highest reading in 2 years.

Australia’s updated mid-year budget will include about A$10 billion ($6.56 billion) in savings as the government seeks to cut spending in an attempt to contain high inflation. Australian households are under financial pressure from high inflation and rising interest rates, but the vast majority of borrowers can service their loans. That means the RBA has room to keep rates high for longer.

S&P 500 (US500) 4,622.44 +18.07 (+0.39%)

Dow Jones (US30) 36,404.93 +157.06 (+0.43%)

DAX (DE40) 16,794.43 +35.21 (+0.21%)

FTSE 100 (UK100) 7,544.89 −9.58 (−0.13%)

USD Index 103.97 -0.01 (-0.01%)

News feed for 2023.12.12:

– Australia RBA Gov Bullock Speaks at 00:20 (GMT+2);
– Japan Producer Price Index (m/m) at 01:50 (GMT+2);
– Australia NAB Business Confidence (m/m) at 02:30 (GMT+2);
– UK Average Earnings Index (m/m) at 09:00 (GMT+2);
– UK Claimant Count Change (m/m) at 09:00 (GMT+2);
– UK Unemployment Rate (m/m) at 09:00 (GMT+2);
– German ZEW Economic Sentiment (m/m) at 12:00 (GMT+2);
– Eurozone ZEW Economic Sentiment (m/m) at 12:00 (GMT+2);
– US Consumer Price Index (m/m) at 15:30 (GMT+2).

By JustMarkets

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

Economics & Fundamentals Financial News

12 Dec

Gold bears eye weekly support ahead of US CPI

By ForexTime

Gold bearish on daily timeframe

4 potential targets identified on H4 chart.

Bearish scenario invalidated above 2039.91

Watch out for US CPI report this afternoon

After the spectacular bearish move on Monday 4th December, gold is back in bearish territory.

This is reflected in the daily timeframe where prices are busy with an impulse in the current downtrend. Bears seem to be aiming for the next weekly support level around 1931.35 with the negative momentum increasing after the solid daily close below the psychological $2000 level. Nevertheless, looking at the 4-hour timeframe might give more insight into what to expect from the precious metal over the next few sessions.

Before we take a deeper dive into the technicals, it is worth keeping in mind that fundamental forces could impact the precious metals’ outlook this week.

The incoming US CPI report released this afternoon could impact expectations around what actions the Fed will take in 2024, ultimately influencing gold.

A softer-than-expected inflation figure may support gold, while a higher-than-expected figure has the potential to drag the precious metal lower.

Shifting our focus back to technicals…

The 4-hour chart validates the daily scenario with a downtrend in progress. The bearish impetus is further confirmed by the price being below the 50 Exponential Moving Average. Both the Momentum Oscillator and the Moving Average Convergence Divergence (MACD) are also beneath their respective base lines.

Attaching a modified Fibonacci tool to the trigger level below the last lower bottom at 1975.75 and dragging it above the 50 Exponential Moving Average at 2039.91, four possible targets can be determined:

The first potential target is at 1950.09 (Target 1).

The second price target is likely at 1937.25 (Target 2).

The third price target is possible at 1911.59 (Target 3) if the price has enough momentum to break through the weekly support level.

The fourth and last price target is feasible at 1879.51 (Target 4) if the bears can continue their rule for long enough.

If the price at 2039.91 is broken, this scenario is no longer valid.

Article by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Economics & Fundamentals Financial News

11 Dec

The ECB and Fed will cut rates sooner than the BoE. Deflationary processes are intensifying in China

By JustMarkets

At the close of the stock market on Friday, the Dow Jones Index (US30) was up by 0.82% (+0.44% for the week), while the S&P 500 Index (US500) added 0.41% (+0.88% for the week). The NASDAQ Technology Index (US100) closed up by 0.45% (+1.66% for the week) on Friday. Stocks initially declined on Friday, and bond yields jumped after the monthly labor market report showed a larger-than-expected increase in non-farm payrolls for November and an unexpected drop in the unemployment rate to a 4-month low, dampening speculation that the Fed will cut interest rates as early as the first quarter of next year. However, stocks reversed and headed higher as inflation expectations eased, and a larger-than-expected increase in the University of Michigan’s US consumer sentiment index for December improved prospects for a soft landing.

US nonfarm payroll employment for November rose by 199,000, exceeding expectations of 185,000. The unemployment rate fell by 0.2 to a 4-month low of 3.7% in November, indicating a stronger labor market. Average hourly earnings in the US for November were up by 4.0% y/y, unchanged from October and in line with expectations. The University of Michigan Consumer Sentiment Index for December rose by 8.1 to a 4-month high of 69.4, exceeding expectations of 62.0. Inflation expectations for 5-10-year inflation also declined in December to 2.8% from 3.2% in November, better than expectations of 3.1%.

Equity markets in Europe were mostly up on Friday. Germany’s DAX (DE40) rose by 0.78% (+2.25% for the week), France’s CAC 40 (FR40) gained 1.32% (+2.66% for the week), Spain’s IBEX 35 (ES35) jumped by 0.76% (+0.86% for the week), and the UK’s FTSE 100 (UK100) closed positive by 0.54% (+0.33% for the week).

Ahead of the December European Central Bank (ECB) meeting, there is growing evidence that the Governing Council is divided on what to present to the markets. Typically hawkish Isabel Schnabel made strong dovish hints by ruling out a rate hike this week, and markets are now pricing in a 135 bps rate cut over the next 12 months. A reassessment of inflation expectations has played a leading role in lowering rates and raising expectations for the first rate cut late in the first quarter of next year.

No rate changes are expected at Thursday’s Bank of England (BoE) meeting, but the Bank of England will counter the rising tide of rate cut expectations. Bank Governor Bailey recently indicated his stance on more rate hikes in an attempt to curb speculation of an imminent rate cut. Markets are predicting three rate cuts in 2024 from the BoE, but the first rate cut won’t come until June 2024 at the earliest, while the ECB and the US Fed could cut rates as early as March-April 2024.

Oil rose on Friday after better-than-expected US economic reports on November payrolls and December consumer sentiment eased recession fears and bolstered prospects for a soft landing, a positive for energy demand and oil prices. In addition, the US plans to replenish the strategic oil reserve by supporting oil. The US Department of Energy released a request to purchase up to 3 million barrels of oil with delivery in March to replenish the Strategic Petroleum Reserve. This was in addition to a previous tender to buy the same volume in February. The Energy Ministry said it will hold monthly tenders to buy oil to replenish the reserve until at least May next year.

Asian markets were mostly down last week. Japan’s Nikkei 225 (JP225) was down by 3.03% for the week, China’s FTSE China A50 (CHA50) lost 3.06% for the five trading days, Hong Kong’s Hang Seng (HK50) fell by 3.46% for the week, and Australia’s ASX 200 (AU200) was positive 1.72% for the week.

Japan’s Q3 GDP data was unexpectedly revised downward to 2.9% y/y from 2.1% y/y, weaker than expectations of 2.0% and the sharpest rate of contraction since the pandemic. The Q3 GDP deflator was revised upward to a record 5.3% y/y from 5.1% y/y.

China’s consumer price index fell by 0.5% in November from the previous month. The index was weaker than expectations of a 0.1% drop and also worsened from October’s 0.1% decline. On an annualized basis, CPI inflation fell by 0.5%, the lowest reading in 3 years. The data contradicts a recent statement from the head of the People’s Bank of China (PBoC), who said inflation would go up. The decline in inflation came despite continued liquidity injections from the government and signaled that Beijing needs to do more to support economic activity.

S&P 500 (US500) 4,604.37 +18.78 (+0.41%)

Dow Jones (US30) 36,247.87 +130.49 (+0.36%)

DAX (DE40) 16,759.22 +130.23 (+0.78%)

FTSE 100 (UK100) 7,554.47 +40.75 (+0.54%)

USD Index 103.98 +0.44 (+0.43%)

News feed for 2023.12.11:

– Norway Inflation Rate (m/m) at 09:00 (GMT+2).

By JustMarkets

Economics & Fundamentals Financial News

11 Dec

Trade Of The Week: SPX500_m gearing up for event heavy week

By ForexTime

SPX500_m hits new 2023 high last Friday

Stock index set to be injected with fresh volatility

Keep eye on US CPI and Fed decision

SPX500_m bullish on D1 chart but RSI signals overbought

Key levels of interest at 4640, 4600 and 4545

After hitting a new 2023 high last Friday, the SPX500_m could be injected with fresh volatility this week due to a series of high-risk events.

US equity bulls remain in the driver’s seat with the SPX500_m bagging its sixth week of gains after the strong US jobs data boosted hopes around the US economy avoiding a recession. The stock Index has also drawn strength from growing bets over the Federal Reserve cutting interest rates next year amid slowing inflation.

Taking a brief peek at the technicals, prices are trending higher on the daily charts. Despite the recent breakout above 4600, it may be worth keeping an eye on the range with support found at 4545.

The next few days could be wild for the SPX500_m and here are 3 reasons why:

1. US data dump

It’s a big week for the US economy thanks to top-tier economic reports including the highly anticipated US CPI report on Tuesday.

This crucial inflation report along with the latest retail sales and industrial production among others could influence bets around what the Fed will do beyond 2023. As highlighted in our week ahead report, headline inflation is expected to have cooled further due to falling energy prices, while the annual core inflation to remain unchanged.

Given how the S&P 500 Index has a handful of tech stocks that remain sensitive to interest rate expectations, the incoming US inflation figures have the ability to rock the index.

The SPX500_m could pull away from the 2023 high if the inflation report exceeds market forecasts.
Should the inflation numbers print below expectations, this could push the index higher as Fed rate cut bets jump.

2. Fed rate decision

Markets widely expect the Federal Reserve to leave rates unchanged on Wednesday, so the focus falls on the updated economic projections and dot plots for fresh clarity on its next move.

The SPX500_m could push higher if the doves dominate the scene with the Fed signalling cuts in 2024.
If the Fed pushes back hopes for rate cuts and reiterates the higher for longer mantra, this may pull the SPX500_m lower.

Note: Looking beyond US data and the Fed decision, it may be worth keeping an eye on the “Triple witching”.

US markets may see a sudden jump in volumes on Friday as Futures and Options contracts on Stocks and Indices expire in what is called “Triple witching”. This happens once a quarter and has the potential to cause some market volatility.

3. Technical forces

Regarding the technical picture, prices are firmly bullish on the daily charts. There have been consistently higher highs and higher lows while prices are trading above the 50, 100 and 200-day SMA. However, the Relative Strength Index (RSI) remains around 70 suggesting that prices are heavily overbought. A technical throwback could be on the table before the index pushes higher.

Should prices stay above the 4600 level, this may open a path towards the 4640 level – the highest level touched in March 2022.
Sustained below 4600 may trigger a selloff back towards 4525
Should 4525 prove to be unreliable support, a decline back towards 4500 and 4470 could be on the cards.

Article by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

Financial News Stock Market News

Risk Disclosure: Foreign Currency trading and trading on margin carries a high level of risk and can result in loss of part or all of your investment. Due to the level of risk and market volatility, Foreign Currency trading may not be suitable for all investors and you should not invest money you cannot afford to lose. Before deciding to invest in the foreign currency exchange market you should carefully consider your investment objectives, level of experience, and risk appetite. You should be aware of all the risks associated with foreign currency exchange trading, and seek advice from an independent financial advisor should you have any doubts.

All information and opinions on this website are for general informational purposes only and do not constitute investment advice.