Yikes! Not a good week. Not at all. At least not if you're a bull. And what say the Commitments of Traders numbers? Holy guacamole. Not good either. Check out the mess of red on my latest signals table, which I've just updated. Here's the lowdown:- S&P 500: This trading setup goes short on the open of Monday, Nov. 2, as announced here three weeks ago. This afternoon's COT numbers are, if anything, even more bearish: the commercial hedgers still more bearish, the wrong-way small traders ag... Read Full Story

Faithful readers have seen me mentioning analyst Tom DeMark and his interesting trading indicators. If you've ever wondered about his system but weren't sure how it works, check out this story I did in the November 2009 issue of Stocks, Futures and Options Magazine. I first read about DeMark on trader and money manager Steven Vita's excellent AlchemyOfTrading.com site. (Also see his free blog here.) Thanks, Stephen! I use some of DeMark's indicators - particularly his TDST support and resist... Read Full Story

What a crappy week if you were a bull. Next week could be all-important for whether the rally's long-anticipated swan dive begins. Or will all the perma-bears out there end up out of luck? On balance, I have to say things don't look good, according to this afternoon's Commitments of Traders data - with one exception: the Nikkei, which just got a bullish signal for Monday's open. I've just updated my latest signals table for the reading pleasure of any masochists out there. You'll recall that ... Read Full Story

Woah, rough day and a rough close today. But the market's long-awaited plunge of the cliff hasn't happened. Folks seem to be really, finally starting to believe in this rally in a big way. Oh-oh.The S&P 500 small traders have boosted up their net long positioning in futures and options to extreme levels in the past two weeks, according to the Commitments of Traders data released weekly by the Commodity Futures Trading Commission.That's not a good thing for bulls. The small traders tend to... Read Full Story

As markets try to break out to new highs, this afternoon's Commitments of Traders report is giving some interesting insights, as usual. Some bullish tidings, but some not so bullish. Check my just-updated latest signals table for the grim details. Witness all that red. Not good. But not all bad either.- U.S. financials: Like last week, the strongest bullish case this week is being made by the data for the three-month Eurodollar contract (the liquidity measure, not the currency). I use this da... Read Full Story

Just got stopped out of my short gold bullion trade on this powerful rally. These things happen. Not every trade makes money. Capital preservation is key, which is why I use stops and control position size. As I noted in a comment to Friday's post, I might now look at going long in a discretionary trade since bullion is acting with exceptional strength against the usual historical trend that the data has seen in the past.UPDATE, 12:25 p.m.: Just went long gold bullion as it broke out above we... Read Full Story

After a tough few days in the markets, next week could look up, according to this afternoon's Commitments of Traders data. My trading setup for the S&P 500 remains bullish. And the data for the bellwether three-month Eurodollar, which gives me signals for the BKX U.S. Bank Index, has taken a bullish turn. I've just updated my latest signals table with the data highlights.- 30-Year U.S. Treasury: My trading setup for the 30-year bond goes to cash on Monday's open after a three-week bearish... Read Full Story

Help save the Commitments of Traders reports in their current form. If you haven't already written to the Commodity Futures Trading Commission, which publishes this invaluable weekly government data on trillions of dollars in derivatives positions in major markets, please do so.The CFTC is proposing to alter the COT report in a way that would greatly reduce the ability of traders and researchers to study it and use it in trading. Its plan is motivated by good intentions - improving market tra... Read Full Story

Oh-oh. Potentially bearish tidings in this week's Commitments of Traders report. The wrong-way small traders in S&P 500 futures and options are suddenly becoming a good deal less skeptical about the market rally. Meanwhile, as you can see on my newly updated latest signals table, the commercial hedgers - the so-called "smart money" - are a lot less bullish than they were last week.This by itself doesn't mean a whole heck of a lot. The changes aren't anywhere near enough to flip my trading... Read Full Story

No new signals for my trading setups based on Friday's Commitments of Traders report. All is quiet. See my newly updated latest signals table for details on how the setups see the data now. Also, no signals pending for Monday's open.The S&P 500 setup is still bullish, and the latest weekly data looks more bullish than last week, with the wrong-way small traders getting much more bearish again, while the "smart money" commercial hedgers are a mite more bullish. Natural gas, however, is loo... Read Full Story