COT: Commodities sold on rising trade tensions — #SaxoStrats
- Extended longs seen in crude oil, gas oil and cocoa
- Combined net-long in WTI and Brent above 1 billion barrels
- Soft sector continues to see record short positions in sugar and coffee
By Ole Hansen
Hedge funds cut bullish commodities bets for a third week as trade tensions continued to take their toll on sentiment across most sectors.
Extended longs continued to be seen in crude oil, gas oil and cocoa while on the sell side silver, palladium, sugar, coffee and livestock all stood out.
Despite the biggest weekly reduction in WTI crude net-long since August the combined net-long in WTI and Brent stayed above 1 million lots (1 billion barrels).
Short-sellers sold the most WTI in four months as inventories at Cushing began to climb, the prompt spread moved towards contango and the discount to Brent widened.
A drag from the struggling white metals of silver, platinum and palladium also helped prevent at proper test of resistance above $1355/oz.
Bearish bets on silver reached a new record while the early 2018 market darling of palladium after 12 weeks of selling saw its net-long being cut to a 17-months low.
The data for this report was collected the day before the sector led by soybeans tumbled as China added key crops to its list of US produced products being targeted for import tariffs.
Ole Hansen is head of commodity strategy at Saxo Bank