Article / 16 March 2015 at 10:27 GMT

COT: No let-up in collapse in bullish commodity bets

Head of Commodity Strategy / Saxo Bank
Denmark
  • Net-long exposure plummets 26% in last week
  • Net-long exposure down more than 50% in less than a month
  • Lots at 332,000 compared to 2.1 million in same week in 2014
  • WTI crude NYMEX lots at 160,000, lowest since January 2013
  • Net-long positions in precious metals down two-thirds since January 27
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Precious metal lots have fallen two-thirds since
January 27, with gold leading the way. Photo: istock

By Ole Hansen

Commodity traders continued their dramatic exit from the sector which remains under sustained pressure from the rising dollar, rising supply and sluggish growth among some of the biggest consuming nations. 

During the week ending March 10, hedge funds cut their net-long exposure on 24 major commodities by 26% to just 332,000. In less than one month, the exposure has more than halved and this time last year the net-long were above 2.1 million lots.

Combined speculative position




















All sectors, apart from livestock, saw reductions with the grain sector especially seeing some aggressive selling of soybeans, soybean oil and corn.

Speculative position in Commodities



Energy was sold again with the net-long in WTI crude on NYMEX reaching the lowest level since January 2013, while profit taking also hit gasoline. With the near-term outlook deteriorating further following last Tuesday, a gross long position of 303,048 lots may still be viewed as excessive.

Precious metals, led by gold, was sold for a sixth week as the technical and fundamental outlook continued to deteriorate ahead of this week's Federal Open Market Committee meeting. From a January 27 peak at 168,000 lots, the net-long has almost dropped by two-thirds since then.

Speculative position in Gold



In the softs sector, the net-short in sugar extended further to the highest on record while cotton succumbed to selling after the net-long recently reached an unsustainable level.

Speculative position in sugar
 Full update attached.

— Edited by Martin O'Rourke

Ole Hansen is head of commodities strategy at social trading leader Saxo Bank
4y
carlosdemarch carlosdemarch
Hi Martin, can you please add the full COT document on the website? Thanks in advance
4y
Ole Hansen Ole Hansen
Hi Carlos. Should be updated shortly.

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