Corn’s tumble: Correction or trend change?

Market Pulse: July 5, 2011

COT Data

Looking at the weekly chart below, you can see the Commercials from the legacy COT report went from -337,635 contracts net-short on June 24 to -259,398 contracts net-short on July 1. That is a liquidation of 78,237 contracts. This also weakened corn. You can see how in the legacy report Commercials liquidated, as did the Large Specs. For a more transparent view of big money, look at the new disaggregated COT report. It shows that not only Managed Money is liquidating, but so are the Swap Dealers. And Producers are liquidating their shorts. At this point I will have to agree with the fundamentals and say this is a bull market correction. Watch to see if the move down builds strength. You can see this with a rising ADX.

Commodity

12-mo low

12-mo hi

1-Jul

24-Jun

Cattle (feed)

-1,290

7,100

4,562

5,543

Cattle (live)

-73,179

10,437

10,437

10,032

Hogs

-35,979

21,270

7,670

13,313

Corn

-413,915

66,274

-259,398

-337,635

Oats

-7,738

-2,034

-4,254

-4,693

Soybeans

-203,260

29,118

-4,840

-73,101

Soybean meal

-90,487

-16,395

-16,395

-45,483

Soybean oil

-117,444

32,394

-21,599

-56,208

Wheat

-32,577

61,768

46,115

46,058

Orange juice

-20,631

-6,588

-20,631

-20,414

Coffee

-47,729

-8,333

-8,333

-9,428

Cocoa

-41,808

8,586

-14,794

-10,222

Sugar

-221,694

-104,595

-161,193

-157,143

Cotton

-69,857

-12,970

-28,032

-30,857

British pound

-66,435

49,738

21,696

10,590

Canada dollar

-115,190

-13,109

-18,130

-27,651

Euro FX

-124,855

50,392

-43,346

-40,691

Japanese yen

-52,533

76,983

-3,573

-32,091

Swiss franc

-42,387

5,110

-23,279

-24,958

US dollar index

-20,849

14,003

-17,535

-9,490

Mexican Peso

-140,414

-14,488

-50,195

-44,999

Australian dollar

-110,025

-10,793

-55,863

-67,183

S&P 500

-88,893

33,981

-29,292

-27,768

T-note -10 yr

-74,761

229,611

120,672

62,146

T-bond -30 yr

-43,324

88,803

49,545

32,930

Eurodollar

-1,179,414

81,781

-225,214

-306,094

Crude oil

-319,669

-25,439

-156,419

-177,978

Heating oil

-66,097

7,568

-27,916

-37,953

RBOB Gasoline

-85,987

-10,453

-56,344

-59,008

Natural gas

108,160

228,910

142,635

128,964

Copper

-36,201

1,793

-5,788

-6,647

Gold

-302,740

-193,197

-208,755

-251,247

Platinum

-34,909

-15,759

-18,670

-23,062

Silver

-65,413

-29,166

-29,166

-35,564



Commercial Net Tracker instructions: This form tracks the Commitment of Traders (COT) data for the commodity futures market. This form "looks" at the most recent five weeks of COT data and provides visual indications of the data. A) If the current value is at a 12-month low, the cell will display a red/burgundy background. B) If the current value is at a 12-month high, the cell will display a green background. C) If the current value went from net negative to net positive, the cell will display a blue background (indicating a bullish condition). D) If the current value is both a 12-month high and also went from a net negative to a net positive, the background will be green. You should view the data with green backgrounds to determine if they also went from net negative to net positive.

If you need help understanding how to understand how to use the COT report to your benefit, please email me at Gary@crbtrader.com and put COT report in the subject line. Please include your name and telephone number in the email.

Proceed to Page 3 for this week's detailed fundementals charts...

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