Commodity Markets

Commodity Weekly February 26, 2023

Feb 26, 2023

Thomas Thornton

Commitment of Traders – update

The Commitments of Traders (CoT) is a weekly report released by the Commodity Futures Trading Commission (CFTC), which continues to be plagued by a cyber attack that started in January. On the note, I posted the charts as they have the weekly DeMark action, while the CFTC has not updated the COT data. COT data has its uses, and I honestly do not weigh it highly in my analysis since there are many ways today long or short positioning can be expressed outside of the futures markets.

DeMark Indicators basics at the bottom of this note

HIGHLIGHTS AND THEMES

Continued dispersion within the commodity markets. The Bloomberg Commodity index hit a new low on Friday. Metals remain under pressure and remain shortable. Energy is mixed with potential Natural Gas bottom but I want to see follow through. Crude still has downside DeMark Countdown’s in progress. Softs including coffee and cocoa could be shorted. Lumber looks like a long again.

BLOOMBERG COMMODITY INDEX DAILY AND WEEKLY

Bloomberg Commodity Index daily hit another new low on Friday.

Bloomberg Commodity Index Weekly has a DeMark Sequential weekly Countdown on week 4 of 13 in progress.

COMMODITY SENTIMENT OVERVIEW

Energy bounced on Friday while mostly everything else was weak with the strong US Dollar

OIL AND ENERGY

Bloomberg Energy Subindex Daily has made a series of lower highs and lower lows.

Bloomberg Energy Subindex Weekly is trying to hold the 200 week moving average

WTI Crude futures daily has made lower highs as well, and there is Sequential in progress

Brent Crude futures daily with a similar Countdown and lower highs

WTI Crude futures bullish sentiment reached the lowest level last week in over a year.

WTI Crude futures Commitment of Traders large speculators and weekly DeMark Setup, Sequential, and Combo indicators. The Sequential weekly with a Sequential on week 9 of 13

Natural Gas futures daily shook us out but might be reemerging to reenter the long trade again.

Natural Gas futures bullish sentiment hit a new low earlier last week and bounced hard. Still needs to clear 30% as a starting point.

Natural Gas futures Commitment of Traders large speculators and weekly DeMark Setup, Sequential, and Combo indicators. New Combo 13

Gasoline Futures Daily also under pressure at support again at 225

Metals

Gold futures daily broke to a new low Friday giving back all YTD gains.

Gold futures bullish sentiment broke 50% midpoint level

Gold futures Commitment of Traders large speculators and weekly DeMark Setup, Sequential, and Combo indicators

Silver futures daily also broke down more on Friday

Silver Futures Sentiment

Silver futures Commitment of Traders large speculators and weekly DeMark Setup, Sequential, and Combo indicators

Copper futures daily also breaking down

Copper futures bullish sentiment still above 50% and that will be watched as it bounced off 50% a few times recently

Copper futures Commitment of Traders large speculators and weekly DeMark Setup, Sequential, and Combo indicators

Platinum daily

Platinum bullish sentiment

Platinum Commitment of Traders large speculators and weekly DeMark Setup, Sequential, and Combo indicators

Palladium daily with new Combo 13. Will it turn after this one?

Palladium bullish sentiment remains under pressure

Palladium Commitment of Traders large speculators and weekly DeMark Setup, Sequential, and Combo indicators. And a new weekly Sequential buy Countdown 13

Grains

Corn futures daily broke down from tight range. Sometimes when three moving averages converge a large break happens. This Sequential 13 is a little less actionable since the 8th red bar was higher than the 5th bar. I like to see the opposite. Could see the Propulsion target below

Corn futures bullish sentiment remains under pressure

Corn futures Commitment of Traders large speculators and weekly DeMark Setup, Sequential, and Combo indicators

Wheat futures daily broke down as well with a new Sequential buy Countdown 13

Wheat futures bullish sentiment back to oversold levels.

Wheat futures Commitment of Traders large speculators and weekly DeMark Setup, Sequential, and Combo indicators. Sequential on week 9 of 13

Soybean futures daily

Soybean futures bullish sentiment rolling over

Soybean futures Commitment of Traders large speculators and weekly DeMark Setup, Sequential, and Combo indicators

Livestock

Cattle futures daily has trended higher

Cattle futures bullish sentiment is in the extreme zone >80%.

Cattle futures Commitment of Traders large speculators and weekly DeMark Setup, Sequential, and Combo indicators. New Sequential and Combo sell Countdown 13’s

Lean Hogs futures daily still laggging

Lean Hogs bullish sentiment remains under pressure

Lean Hogs Commitment of Traders large speculators and weekly DeMark Setup, Sequential, and Combo indicators

Softs

Cotton futures daily sideways still

Cotton futures bullish sentiment improving

Cotton Futures Commitment of Traders large speculators and weekly DeMark Setup, Sequential, and Combo indicators

Coffee futures daily hit the 200 day and has some pending DeMark exhaustion signals. I sold the long Coffee trade for a strong gain of 24% despite the pending signals since sentiment hit extreme levels.

Coffee futures bullish sentiment hit 89%, an extreme reading, which is one reason I sold the position. This was an oversold to overbought buy-to-sell trade. Our data feed still is buggy.

Sugar futures daily

Sugar futures bullish sentiment

Sugar futures Commitment of Traders large speculators and weekly DeMark Setup, Sequential, and Combo indicators

Cocoa futures daily should pullback on these Combo 13’s

Cocoa futures bullish sentiment reached overbought levels and reversed like Coffee

Cocoa futures Commitment of Traders large speculators and weekly DeMark Setup, Sequential, and Combo indicators

Lumber futures daily could reverse up following up on upside price flip after Combo 13

Lumber bullish sentiment tends to go wire to wire and now oversold could move higher

DeMark Sequential Basics

MORE DETAILED COMMITMENT OF TRADERS DEFINITIONS