I am yet to discover again whether there is any edge left in the COT data as far as the commercials are concerned or perhaps when there is any edge to read...
Why do you think this huge shift by the commercials should be now considered bullish? Because they not only hedged, but also loaded up? I don't get it... If only, they probably hedged the heck out of their (short) positions...
Of course, the important is the small speculators and they are definitely at the wrong side...
Also look at OEX Put / Call ratios (short-term implications) and Commitment of Traders (long-term implications). It is not easy to justify a bearish case.
Denleo
You may be seeing some posts this weekend about the *massive*, absolutely massive, bullish changes in the large S&P futures contract in this week's COT. Then again, the bears will point out the bearish shift in the smaller contract.
Based on the above, I don't think the commercials have anything over the other S&P traders over the last year. They were net short from 1340 up to 1460, net long from about 1480 down to 1375. If anything it looks to me like the large specs fared a little better than anyone else.
Edited by kisacik, 28 September 2007 - 05:47 PM.