November 18, 2018 - Institutional Positions & Supply and Demand for the Majors, Gold and Oil!

The positions below represent the institutional positions held as of November 13th, 2018!

This week we started to see some reversals taking place. Now they are just the start of a reversal and we have yet to know if it will continue but putting all the evidence together there is clearly a bias with what direction the markets should start heading in. We have examine previous #cftc data and determined that the institutions interests should be focused on profit taking and the last few weeks we can see this is clearly taking place. Now when they are focused on profit taking they could start accumulating a position on the other side and we can see some evidence of that beginning. It could also be the start of some hedging but again this is too early to know for sure. If you take a look at the #usdjpy you’ll see that longs are increasing but short increased a massive amount this past week, right when we are at levels that we expect a drop to begin to form. So is this some hedging taking place? The next couple weeks will make this clearer for us.

The key point to remember here is the profit taking theme is playing out very much like we were expecting. The thing to be watchful here now is if the profit taking will lead to a reversal in price which will propel price in the opposite direction to eventually build on a larger position in the original direction. For instance, take a look at #oil. We have been expecting some profit taking on longs and this is what has been taking place. Now we are seeing that short have become aggressive and the question is how aggressive will shorts become, will they drop price enough to add more longs again for a larger rally higher or is this increase in shorts preparing for a much larger move downwards?

This week I’ll be watching for signs of the bigger picture playing out, which again are reversals taking place from profit taking by the institutions.


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