Last week September 2012 T-Bonds opened at 148-26 on Monday and closed Monday at 148-26, forming a doji candle and highlighting uncertainty and indecision for the start of the week. By Friday, T-Bonds had closed down 2-31 to finish the week at 145-28.
On July 27, the TS Analyzer at Trends in Futures quickly brought to light that the DI (from ADX) Differential had moved to zero and a red technical trade set-up was highlighted with MACD crossing down below the signal line, and Stochastics starting to correct from overbought territory. As of Friday’s close, ADX was at 43.5 showing T-Bonds to be in a strong trend down. MACD is bearish crossing the signal line down and then the zero on the histogram while adding divergence. As a result, Stochastics are currently in oversold territory.
Looking at the weekly chart below you can see the price action from mid- August 2011 through early May 2012 T-Bonds were in a solid weekly range. The top was at 145-00, bottom at 135-00 and pivot at 140-00.
Proceed to Page 2 for the latest COT Data...
On the COT-Traders in Financial Futures report, you can see how Dealers started adding to net shorts mid-April and Asset Managers added to net longs at the same time. As this buying and selling increased, look at the weekly price action as the market broke through 145-00 on its way up. You can see how Dealers and Asset Managers started liquidating and the price drop that started the week of July 23. This past week Dealers added a small number of contracts to net shorts now at -98,459 contracts and Asset Managers added a small number of long contracts to net longs at 81,916 contracts. Keep a sharp eye on these numbers over the next few weeks to see if big money is continuing to change posture from bull to bear. Keep in mind that the news from Europe over the weekend could send T-Bonds higher early this week.
If you need help understanding how to understand how to use the NEW COT report to your benefit get instant access to my new e-book "What Lies Beneath ALL Trends". It is filled with eye opening information.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.
Proceed to Page 3 for this week's detailed fundementals...
Have a prosperous trading week.
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