Weekend Thread

COT Report - Naz Futures (Sentimentrader.com)

This is definitely not what I was expecting to see when I started flipping through the COT reports this afternoon. Commercials are now just as short as they were before the rollover in April-May. The report from last week was that little blip up on the indicator line to -4000. "They are still net short, but not extreme anymore"... I thought last week. I was not expecting this push back to an extreme position so quick. Anyway, that doesn't give me the warm and fuzzies considering I held some longs into the weekend.

A couple of thoughts.... First is that these positions are up to Tuesday of this week, and we had some wild activity yesterday. I'm wondering if they (commercials) were covering. It would certainly explain the heavy volume and zippy action. Naz futures went down 48, up 46, down 43 yesterday... then up 79 to today's high. Second thought is maybe we are getting to a moment where these positions are not as meaningful. I'm shaking my head after typing that because this year it has been pretty accurate when at this kind of extreme.

The COT on VIX is still showing about the same reading as last week (commercials extremely long VIX futures)... so that's also potentially bearish. There was a similar push into shorts in the S&P and Dow futures, although not as much as the Naz. All of this data plus the fact that we are getting closer to a short term "ripe for selling" signal has me anxious to sell longs on Monday (hopefully on a push up). I want to step away from swing long positions and stick with mostly day trades until I see how this data plays out.