Alchymist

A Futures Trading and Research Portal - Know the Odds. Measure Risk. Execute your strategy.

  • Overview
  • Features
  • Pricing
  • FAQs
  • Sign Up
  • Blog
  • Member Area
    • Alchymist Platform
    • Manifesto
    • Risk Disclaimer
    • Investors/Partner
    • End-User License Agreement
  • Contact
  • Login

Jul 22 2018

Commercials and Funds Now at 18month Extremes Across the Metals complex

Commercial traders have been buying the recent weakness in metals, while funds have been piling into shorts. Across our proprietary scoring system were are seeing 90+ for net positioning for commercials, and sub 5% for funds on a 18 month basis.

At extremes, the trend following funds are always positioned "max wrong" as they continue to sell into weakness - This offsides positioning is what leads to sharp retrace rallies, and/or the start of the next intermediate move in the opposite direction.

The key here is not to get greedy - While Commercials are bullish, we will note that it is primarily driven by the Producer Merchant category with 100% scores - In order to see a confirmed sentiment bottom, we want to see the Swap Dealers get back over 90% - currently they are only at 62% for gold.

So you can start to position for some buy side scalps over the coming weeks, but be prepared for a retest of these recent lows lows as the Swap Dealers look to position max long for the next intermediate up trend.

Filed Under: Uncategorized

  • Risk Disclaimer
  • Investors/Partner
  • FAQs
  • Blog
  • Contact

Copyright © 2023 - 3ptCapital