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Hi Sergio...................
Based on your highlights on Committment of Traders data.....you track the percentage of Open Interest and the Long/Short percentile of positions held. If my conclusion is correct you are looking at Gross Position holdings.....you need to add another formula.....Net Trader Positions...whereby you would take the Commercials Gross holdings Long/Short and Net their value.
An example if the Commercials are Short 8,000 contracts.....and Long 10,000 contracts you would subtract the +10k from the -8k for a +2,000 Net Position....Net Majority Commercial Positions is the Formula that will enable you to have an accurate assesment
of this powerful group....and a index of current/future Directional
Price Movement based on Commercial Net Positions.
On Open Interest....always use total Open Interest. When Open Interest increases this is a Bearish sign....as when Open Interest decreases this is a Bullish sign.The Signal on Open Interest is most pronounced in a consolidation/range Market. Notice that as Open Interest expands to a higher level that Price Action begins to stall...and as Open Interest decreases a Rally is unfolding. Another important ingredient that should be combined with Net Traders Position data.
Time the Trend.
Iris
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