DISCLAIMER

PLEASE READ THE DISCLAIMER AT THE BOTTOM OF THIS PAGE WHICH APPLIES TO ALL CONTENT IN THIS BLOG AS WELL AS ANY OTHER MATERIAL FROM WE ARE FUTURES TRADERS LLC. READING ANY CONTENT BELOW CONSTITUTES AN AGREEMENT BY ALL READERS THAT THEY HAVE READ AND AGREE TO ALL THAT IS SET FORTH IN THE DISCLAIMER AT THE BOTTOM OF THIS PAGE.


Tuesday, September 05, 2006

Crude Oil

Lewis, here is a current chart of crude in response to our exchange on this market. We are in a downtrend in price and the commercials who had gotten heavily short as marked by the downtrending red line, have moved back to neutral ground.

Open interest is not declining which is what we would want to consider long positions. That is somewhat simplistic and has exceptions, but is the general rule.

So we have a downtrend in price, and really nothing fundamental telling us to buy it, so short the pullbacks until this changes. If you go back to the post from mid August on this market, you can see how we have fallen further from the spot where I pointed out that the commercials were short.

Things do not always follow the script this perfectly, but it is suprising how often they do when you are keyed in on the right fundamentals.

2 comments:

lew said...

thanks chris

seems to me that it's key to follow what the commercials do; are there resources on the web that are avaialble to non-professionals ?

Chris Johnston said...

The COT report comes to me as part of my data service, and it is a pay for view item. I do not know if it can be viewed free of charge.

Contact the CFTC and ask them.