Analysis of Gold Futures COT Report (as of 8 July 2025)

 

Key Observations:

1. Open Interest & Market Activity

   • Total Open Interest: 443,144 contracts (↑15,482 from previous week).

   • Number of Traders: 299 (indicating broad participation).

   • Managed Money (Hedge Funds/Speculators) holds the largest long exposure (37.2%), while Swap Dealers dominate short positions (51.2%).

2. Positioning by Trader Category

   • Managed Money (Speculators):

     • Longs: 164,685 (↑401) – Bullish sentiment remains strong.

     • Shorts: 35,743 (↑11,017) – Some hedging/shorting activity.

     • Net Long: +128,942 contracts (bullish bias, but shorts increased).

   • Swap Dealers (Banks/Institutions):

     • Shorts: 226,901 (↑12,085) – Heavy hedging/professional selling.

     • Longs: 35,359 (↓1,001) – Slight reduction in bullish bets.

   • Producers/Merchants (Commercials):

     • Shorts: 60,427 (↓991) – Slight reduction in hedging.

     • Longs: 13,615 (↑14,610) – Minor increase in bullish hedging.

   • Other Reportables & Small Traders:

     • Other Reportables increased longs (97,000, ↑13,455).

     • Nonreportable (Retail Traders) hold 56,291 longs (↑12,907), showing retail bullishness.

3. Market Sentiment Implications

   • Bullish Factors:

     • Managed Money remains heavily net long (speculative bullishness).

     • Retail traders (Nonreportable) increased longs.

   • Bearish Factors:

     • Swap Dealers hold a massive short position (often a contrarian indicator).

     • Managed Money shorts increased, suggesting some caution.

Conclusion:

• Gold remains in a bullish trend (supported by speculators and retail traders).

• However, Swap Dealers’ extreme short positioning warns of potential pullbacks if profit-taking occurs.

• Watch for: A sustained rise in Managed Money shorts or Swap Dealer covering (which could signal a reversal).

Analysis of the CFTC COT Report for the Dollar Index (as of 8 July 2025)

 

Key Data Points:

• Open Interest (OI): 35,076 contracts

• Total Traders: 128

• Total Changes: 41,210

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Positioning by Trader Category:

1. Dealers (Typically Banks/Market Makers)

   • Long Positions: 9,400 (26.8% of OI)

   • Short Positions: 0 (0.0% of OI)

   • Spread Positions: 86 (0.2% of OI)

   • Key Takeaway: Dealers are heavily net long, suggesting they are betting on USD strength or hedging against weakness.

2. Asset Managers/Institutional Investors

   • Long Positions: 3,241 (9.2% of OI)

   • Short Positions: 11,462 (32.7% of OI)

   • Spread Positions: 1,765 (5.0% of OI)

   • Key Takeaway: Asset managers are significantly net short, indicating bearish sentiment toward the USD.

3. Leveraged Funds (Hedge Funds/CTAs)

   • Long Positions: 13,952 (39.8% of OI)

   • Short Positions: 12,344 (35.2% of OI)

   • Spread Positions: 1,204 (3.4% of OI)

   • Key Takeaway: Leveraged funds are slightly net long, but the near-balance suggests uncertainty or a neutral stance.

4. Other Reportables (Large Speculators Not Elsewhere Classified)

   • Long Positions: 2,195 (6.3% of OI)

   • Short Positions: 4,206 (12.0% of OI)

   • Key Takeaway: Net short positioning, aligning with asset managers' bearish outlook.

5. Nonreportable Positions (Small Speculators)

   • Long Positions: 3,233 (9.2% of OI)

   • Short Positions: 4,009 (11.4% of OI)

   • Key Takeaway: Small traders are also net short, reinforcing the bearish bias.

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Net Positioning Summary:

Category	Net Position (Long - Short)	Sentiment
Dealers	+9,400 (Strong Net Long)	Bullish USD
Asset Managers	-8,221 (Strong Net Short)	Bearish USD
Leveraged Funds	+1,608 (Slight Net Long)	Neutral/Bullish
Other Reportables	-2,011 (Net Short)	Bearish USD
Nonreportable	-776 (Net Short)	Bearish USD

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Key Insights:

1. Divergence Between Dealers and Asset Managers:

   • Dealers (typically "smart money") are heavily long, while asset managers ("big money") are heavily short. This divergence often signals a potential inflection point in the market.

   • Historically, when dealers take extreme positions against asset managers, it can precede reversals.

2. Leveraged Funds Neutral:

   • Hedge funds are nearly balanced, suggesting no strong directional bias.

3. Retail/Small Traders Bearish:

   • Small speculators are net short, which is often a contrarian indicator (retail traders tend to be wrong at extremes).

4. Open Interest & Changes:

   • High open interest (35,076) and total changes (41,210) indicate active trading, but the net positioning suggests mixed sentiment.

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Market Implications:

• Bullish Case (USD Strength):

  • If dealers’ net long position is correct, the USD could rally, especially if leveraged funds shift to more longs.

  • A reversal in asset managers’ shorts could amplify upside momentum.

• Bearish Case (USD Weakness):

  • If asset managers’ net shorts prevail, the USD could decline further, especially if dealers reduce longs.

  • A breakdown below key support levels may trigger follow-through selling.

• Neutral/Consolidation Scenario:

  • The mixed signals (dealers long vs. asset managers short) may lead to range-bound trading until a clearer trend emerges.

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Actionable Takeaways:

• Watch for Reversals: Monitor if asset managers start covering shorts or dealers reduce longs.

• Key Levels: Technical analysis (support/resistance) will be crucial alongside COT data.

• Macro Drivers: Fed policy, risk sentiment, and global growth trends will influence USD direction.

This report suggests a tug-of-war between "smart money" (dealers) and institutional investors, making the USD index prone to volatility. A breakout in either direction could be significant.

Bullish Max Butterfly Harmonics Pattern

 A bullish Max Butterfly pattern emerged on GBPUSD 1hr chart

 

 

Ichimoku Kinko Hyo trade on Japanese cross pairs

 We have very strong bullish trend on several japanese cross currency pairs.

Have a look at below charts attached :

CHFJPY Weekly Chart. This pair looks trending very high

 

EURJPY daily chart.

 USDJPY H4 chart. It looks price might get back to the high of 148.00.

 GBPJPY Weekly chart. Future cloud change color signalling a bullish run.

 

 

Analysis of Euro FX COT Report (24 June 2025)

 

Key Observations:

1. Open Interest (OI) & Market Activity:

   • Total OI: 762,607 contracts (↑16,746 from prior week).

   • Number of Traders: 306 (indicating moderate participation).

2. Dealers (Banks/Market Makers):

   • Extremely Net Short (Bearish EUR):

     • Short Positions: 458,976 (60.2% of OI, dominant force).

     • Long Positions: Only 31,477 (4.1%).

   • Implication: Dealers are heavily hedging or betting against EUR strength.

3. Asset Managers/Institutional Investors:

   • Strongly Net Long (Bullish EUR):

     • Long Positions: 458,163 (60.1% of OI, largest group).

     • Short Positions: 120,432 (15.8%).

   • Implication: Big money expects EUR appreciation, possibly due to ECB policy shifts or USD weakness.

4. Leveraged Funds (Hedge Funds/CTAs):

   • Moderately Net Long:

     • Long: 88,638 (11.6%) vs. Short: 67,545 (8.9%).

   • Implication: Speculative funds lean long but not aggressively.

5. Other Reportables & Nonreportables:

   • Other Reportables: Slightly net long (35,105 vs. 19,596).

   • Nonreportable Positions (Small Traders): Net long (94,870 vs. 41,704).

   • Implication: Retail/small traders are bullish, but their influence is limited.

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Market Sentiment & Implications:

• Divergence Between Dealers and Asset Managers:

  • Dealers (banks) are heavily short, while institutions are heavily long. This suggests a battle between hedging flows (dealers) and fundamental bets (asset managers).

  • Historically, extreme dealer shorts can precede EUR rallies if positioning unwinds.

• EUR Outlook:

  • Bullish Case: If asset managers dominate, EUR could rise (e.g., if Fed cuts rates before ECB).

  • Bearish Risk: If dealers maintain/expand shorts, EUR may face downward pressure (e.g., if EU growth weakens).

• Technical Consideration:

  • High OI + rising longs from asset managers = potential for a short squeeze if EUR breaks key resistance.

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Actionable Insight:

• Watch for Catalyst: ECB policy signals or US data to determine if dealer shorts cover (bullish EUR) or institutional longs exit (bearish).

• Contrarian Signal: Extreme dealer shorts could mean EUR is undervalued, but confirmation (e.g., price breakout) is needed.

Conclusion: The market is split, but institutional bullishness suggests upside potential if macro conditions align.

Analysis of the British Pound COT Report (24 June 205)

 

 

Key Data Overview

• Open Interest (OI): 179,898 contracts (↑12,872 from prior week)

• Total Traders: 108

• Contract Size: GBP 62,500

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Positioning by Trader Type

1. Dealer Intermediaries

   • Net Short: Significant short bias (42,599 short vs. 9,361 long).

   • Change: Increased short positions by 1,977 contracts.

   • Implication: Dealers (often banks) are hedging or betting against GBP strength.

2. Asset Managers/Institutional

   • Net Short: 78,243 short vs. 64,941 long.

   • Change: Added 15,005 new short positions (bearish shift).

   • Implication: Institutional sentiment is turning negative on GBP.

3. Leveraged Funds (Hedge Funds)

   • Net Long: 63,501 long vs. 21,817 short.

   • Change: Increased longs by 1,148 and shorts by 6,984.

   • Implication: Hedge funds remain bullish but trimmed some exposure.

4. Other Reportables & Nonreportables

   • Nonreportable Positions (small traders): Net long (35,906 long vs. 26,266 short).

   • Other Reportables: Minimal activity (0 long, 4,784 short).

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Net Positioning (Long vs. Short)

• Dealers: Strongly net short.

• Asset Managers: Moderately net short (increased bearishness).

• Leveraged Funds: Strongly net long (bullish, but less aggressive).

• Small Traders: Slightly net long (contrarian indicator if extreme).

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Key Takeaways

• Bearish Pressure: Dealers and asset managers are increasing short exposure, signaling institutional skepticism about GBP strength.

• Bullish Hedge Funds: Leveraged funds remain net long, but their added shorts suggest caution.

• Open Interest Rise: Increased OI alongside price movement would confirm trend strength (data not shown here).

Market Implications

• Short-Term: GBP may face downward pressure if institutional shorts dominate.

• Contrarian Watch: If leveraged funds unwind longs, GBP could weaken further.

• Confirmation Needed: Pair this with price action (e.g., GBP/USD trend) for directional bias.

Actionable Insight

Monitor for:

1. Price breaking key support (aligned with rising shorts).

2. Leveraged funds reducing longs (would amplify bearish momentum).

Analysis of the US Dollar Index COT Report (June 24, 2025)

 

Key Takeaways:

1. Market Sentiment:

   • Leveraged Funds (Hedge Funds/Speculators) hold a net short position (11,113 short vs. 10,723 long), suggesting bearish sentiment toward the USD.

   • Asset Managers/Institutions are also net short (8,738 short vs. 3,421 long), reinforcing a cautious outlook.

   • Dealers (Market Makers) are heavily long (9,413 long vs. 0 short), which could indicate hedging activity or contrarian positioning.

2. Open Interest & Changes:

   • Total Open Interest: 31,225 contracts (↓$84 from prior week).

   • Leveraged Funds increased short exposure (+41,816 contracts), a strong bearish signal.

   • Asset Managers reduced longs (↓¥40) while increasing shorts (+2,464), aligning with bearish momentum.

3. Positioning Breakdown:

   • Long Dominance: Dealers (30.1%) and Leveraged Funds (34.3%) hold the largest long positions.

   • Short Dominance: Leveraged Funds (35.6%) and Asset Managers (28.0%) drive the bearish pressure.

   • Nonreportable Positions (Retail Traders?) are net short (3,554 short vs. 2,840 long), often a contrarian indicator.

Implications for the US Dollar (DXY):

• Bearish Pressure: The increase in speculative shorts suggests weakening confidence in the USD.

• Contrarian Signal: Dealers' extreme long positioning may indicate a potential reversal if shorts get squeezed.

• Watch for: Any shift in Fed policy or risk sentiment that could trigger a short-covering rally.

Conclusion:

The COT report reflects strong bearish sentiment among large traders, but extreme positioning could lead to a reversal if macroeconomic conditions shift (e.g., Fed hawkishness, safe-haven demand). Monitor price action for confirmation.