Commercial Trader Watch
When trading commodity futures, whether physical or financial, it is important to pay close attention to market position. Thanks to the Commodity Futures Trading Commission, large speculative and commercial traders are required to report positions on a weekly basis, and this data is aggregated and reported to the public on Friday afternoons. Although many commodity markets can be theoretically gamed, either through the movement of physical stocks in and out of delivery warehouses or by the holding of offsetting positions and other ownership rights that are not reported, the net positioning of commercial versus speculative traders often reaches extremes near major market turning points.
Just the other day, I anxiously awaited the probe of the dollar/yen currency cross back down through the 80 level, looking to buy the dollar and short the yen for an expected move back toward the highs of 84 registered in mid-March. For many technical reasons the 80 level looked to be an excellent re-entry point....676 more words left in this article. To read them, just click below and try Real Money FREE for 14 days.
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