We use the Commodity Futures Trading Commission Commitment of Traders report to generate daily buy and sell signals in the commodity futures markets and Exchange Traded Funds. Our analysis has been featured in many places online and in print and is disseminated nightly via the COT Signals, nightly email.
Wednesday, August 22, 2012
Key Reversal Triggers Dow Sell Signal
Commitment of Traders sell signal triggered by key reversal bar.
trade setup is merely a random sample of the day’s trades generated by COT
Signals. To track our work their and receive all of our nightly trading
made a new four month high at 13308 yesterday. The new high was masde on
declining volume and open interest and the market was unable to hold the new
level leading to a key reversal bar.
This is a classic example
combination of technical and fundamental factors coming together to create a
solid trade setup. The Commitment of Traders commercial traders have been
selling the Dow for the entire rally, paring more than 50% of the long position
they accumulated at the June lows. Fundamentally, we discussed the overvalued
nature of the equity markets in last week’s blog. Finally, the key
reversal bar at 90 day highs is technical analysis 101. We have sold the Dow
futures and placed our protective stops at yesterday’s swing high of 13308.
information is not to be construed as an offer to sell or a solicitation or an
offer to buy the commodities herein named. The factual information of this
report has been obtained from sources believed to be reliable, but is not
necessarily all-inclusive and is not guaranteed as to the accuracy, and is not
to be construed as representation by Commodity & Derivative Adv. The risk
of trading futures and options can be substantial. Each investor must consider
whether this is a suitable investment. Past performance is not indicative of