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The time frame for the current Commitments of Traders report is from Wednesday, July 15 through Tuesday, July 21.

Soybeans:

For the week, August soybeans lost 23.50 cents, September -38.50, new crop November -41.75. The COT report revealed that managed money added 3,204 contracts to their long positions and liquidated 5,666 of their short positions. Commercial interests liquidated 2,290 of their long positions and added 4,195 to their short positions. As of the latest report, managed money is long soybeans by a ratio of 3.36:1, which is a sizable jump from the previous week of 2.81:1 and dramatically higher than the ratio two weeks ago of 2.25:1.

One remarkable aspect of the July 21 COT report was that during the tabulation period of July 15-July 21, August soybeans fell 14.75 cents while total open interest increased by 3,278. In summary, managed money was increasing their net long position while soybean prices declined. Also, during the COT reporting period with total open interest increasing, we have confirmation that short sellers are in control of the market.

Note the ratio in soybeans is substantially below that of corn (3.36:1 versus 4.98:1) even though soybeans have been outperforming corn during the third quarter and year to date. 

The COT report for June 10, 2014 revealed that managed money was long soybeans by a ratio of 2.94:1 and with the current ratio handily above the ratio of June 10, managed money has never been as bullish as they are in the current report during the past 13 months.

The major difference between the current report and the one tabulated on June 10, 2014 is the price level of soybeans. For example, the trading range encompassed by the 2014 COT report of June 10 (June 4-June 10) was dramatically higher during June 2014 than July 2015 and the range from low to high was $14.52-14.95 3/4. In summary, managed money has never been as bullish in the current report since June 2014, even though soybean prices are more than $4.50 lower.

On June 10 2014, managed money was net long by 100,186 contracts, which represented a ratio of 2.94:1 and as of the July 21, 2015 COT report, managed money was net long by 82,379 contracts, or a ratio of 3.36:1. Although participation by managed money is lower in the current report than last year, the ratio of long to short positions is higher in the current report.

Commercial participation stands in major contrast to managed money. For example, in the June 10, 2014 report, commercial interests held a net short position of 110,524 contracts, or a short ratio of 1.64:1 and by the current report, commercials were net short by 199,603 contracts or a short ratio of 2.06:1, indicating that commercial interests are more active in the market than managed money. In summary, commercial interests are far more bearish today than they were in the June 10, 2014 report.

On Friday, August soybeans closed (9.91 1/4) at their lowest level since July 7 (9.92), but the net long position of managed money has increased considerably since the July 7 COT report. The July 7 COT report revealed that managed money was net long by 63,234 contracts and this has increased to 82,379 by the July 21 report. 

As a consequence, a fair number of professional money managers are holding positions that are underwater. Additionally, August soybeans are close to generating a short-term sell signal. This leaves soybeans vulnerable to  considerable downside action and managed money will provide the fuel for the continued move lower.

Soybean meal:

For the week, August soybean meal lost $6.30, September -7.60, new crop December -14.30. The COT report revealed that managed money added 4,658 to their long positions and liquidated 2,903 of their short positions. Commercial interests added 1,054 to their long positions and also added 12,130 to their short positions. As of the latest report, managed money is long soybean meal by ratio of 3.02:1, which is up sharply from the previous week of 2.62:1 and is an increase of 50% from the ratio two weeks ago 2.16:1.

Soybean oil:

For the week, August soybean oil lost 1.30 cents, September -1.31, new crop December -1.31. The COT report revealed that managed money liquidated 3,408 of their long positions and added 6,216 to their short positions. Commercial interests added 439 contracts to their long positions and liquidated 9,251 of their short positions. As of the latest report, managed money is long soybean oil by ratio of 1.44:1, which is down from the previous week of 1.76:1, but about the same as the ratio two weeks ago of 1.43:1.

Corn:

For the week, September corn lost 27.75 cents, new cropped December -28.50, March 2016 -28.75. The COT report revealed that managed money added an astounding 43,812 contracts to their long positions and liquidated 28,684 contracts of their short positions. Commercial interests liquidated 6,199 of their long positions and added a massive 46,054 to their short positions. As of the latest report, managed money is long by an amazing 4.98:1, which is a sharp increase from the previous week of 2.93:1 and more than double the ratio two weeks ago of 2.23:1.

It should be noted that this week’s COT report was the first in which managed money added more new long positions than liquidated short positions since the rally began. This gives additional credence that Johnny-come-lately’s are getting bullish at the top end of the trading range. It was only three weeks ago that managed money was long corn by a ratio of 1.19:1

The current ratio of 4.98:1 is the highest since December 23, 2014 when managed money was long corn by a ratio of 4.75:1.The trading range encompassed by the nearby March 2015 contract during the December 23, 2014 reporting period was 4.03 1/2 -4.15 3/4, or below the trading range encompassed by the July 21, 2015 report of 4.02 1/2 – 4.38 3/4.

The participation by managed money in the December 23, 2014 report showed a net long position of 233,725 contracts contracts versus the net long of  247,791 contracts held by managed money in the July 21 report. Currently, managed money is holding approximately the same net long position as they were in late December 2014.

Like soybeans, commercial participation is considerably greater in the current report with commercial interests holding a net short position of 451,212 contracts, or a short ratio of 2.73:1 versus the December 23, 2014 net short position of 415,408 contracts or a short ratio of 2.79:1. 

During the span of the July 21 COT reporting period (July 15-July 21), September corn lost 21.50 cents while total open interest increased by 36,961 contracts in this time frame. Consistently, in a variety of time frames, we see total open interest increase on price declines, which continues to confirm that short sellers are in control of the board.

As of Friday’s close, the September contract is trading near the lows of June 30 and is likely to generate a short-term sell signal, which could occur as early as Monday. With a massive long position held by managed money, there is more than enough fuel to send corn sharply lower, and this is what we think will occur.

Another point to keep in mind: Because a fair number of professional money managers are holding positions that are underwater, when corn does rally, selling by these managers to trim losses will keep a lid on it advances. We have been expecting a rally, and now think it will be muted due to the overhang of speculative long positions showing losses.

Chicago wheat: On July 21, September Chicago wheat generated a short-term sell signal, but remains on intermediate term buy signal.

For the week, September Chicago wheat lost 42.25 cents, new crop December -43.75, March 2016 -45.00. The COT report revealed that managed money liquidated 7,358 of their long positions and added 6,423 to their short positions. Commercial interests added 1,071 to their long positions and liquidated 4,829 of their short positions. As of the latest report, managed money is long Chicago wheat by a ratio of 1.25:1, which is down from the previous week of 1.49:1 and the ratio two weeks ago of 1.60:1.

Kansas City wheat:

For the week, September Kansas City wheat lost 39.25 cents, new crop December -38.75, March 2016 -38.50. The COT report revealed that managed money added 2,726 to their long positions and also added 3,753 to their short positions. Commercial interests added 3,440 to their long positions and liquidated 1,141 of their short positions. As of the latest report, managed money is long Kansas City wheat by a ratio of 1.18:1, which is down from the previous week of 1.24:1 and the ratio two weeks ago of 1.21:1.

Thus far in the third quarter, August soybean meal is the out performer with a loss of 1.31%, August soybeans -5.55%, September corn -6.99%, August soybean oil -9.18%, September Kansas City wheat -16.88%, September Chicago wheat -16.89%.

Year to date, August soybean meal is the out performer with a loss of 2.69%, August soybeans -4.27%, August soybean oil -4.66%, September corn -5.48%, September Chicago wheat -15.38%, September Kansas City wheat -21.48%.

Cotton:

For the week, December cotton lost 58 points, March 2016 -48, May 2016-33. The COT report revealed that management liquidated 3,645 of their long positions and added 42 contracts to their short positions. Commercial interests added 2,023 to their long positions and liquidated 1,850 of their short positions. As of the latest report, managed money is long cotton by a ratio of 3.87:1, which is down from the previous week of 4.12:1 and the ratio two weeks ago of 4.55:1.

Sugar #11: On July 20, October sugar generated a short-term sell signal, which reverses the short-term buy signal of July 13. October sugar remains on intermediate term sell signal.

For the week, October sugar lost 72 points, March 2016 -78, May 2016 -75. The COT report revealed that managed money added 604 contracts to their long positions and also added 46,241 contracts to their short positions. Commercial interests added 14,500 contracts to their long positions and liquidated 34,344 of their short positions. As of the latest report, managed money is short sugar by a ratio of 1.32:1, which is an increase from the previous week of 1.003:1, and slightly above the ratio two weeks ago of 1.27:1.

During the past week, October, March 2016, and May 2016 sugar made new contract lows of 11.20, 12.54, and 12.64 respectively.

Coffee:

For the week, September coffee lost 6.15 cents, December -6.25, March 2016 -6.25. The COT report revealed that managed money added 1,191 contracts to their long positions and also added 1,000 to their short positions. Commercial interests added 640 contracts to their long positions and also added 186 to their short positions. As of the latest report, managed money is short coffee by a ratio of 1.57:1, which is down slightly from the previous week of 1.60:1 and the ratio two weeks ago of 1.78:1.

During the past week, September and December 2015 coffee made new contract lows of 1.2065 and 1.2410 respectively.

Cocoa: It appears likely that September cocoa will generate a short and possibly an intermediate term sell signal this coming week. The short term sell signal could come as early as Monday.

For the week, September cocoa lost $165.00, December -159.00, March 2016 -155.00. The COT report revealed that managed money liquidated 136 contracts of their long positions and also liquidated 147 of their short positions. Commercial interests liquidated 923 of their long positions and also liquidated 1,517 of their short positions. As of the latest report, managed money is long cocoa by a ratio of 3.17:1, which is up slightly from the previous week of 3.15:1, but down from the ratio two weeks ago of 3.38:1.

Live cattle: Last week, we recommended that bearish positions originally recommended on July 1 be liquidated. The trade proved to be a highly lucrative. Our recommendation to liquidate the position was based upon large increases of open interest on price declines toward the end of last week, which indicated Johnny-come-lately’s were getting bearish on live cattle, and this means a rally is not far off.

For the week, August live cattle lost 3.63 cents, October -5.00, December -4.17. The COT report revealed that managed money liquidated 6,951 of their long positions and added 7,795 to their short positions. Commercial interests added 3,780 to their long positions and liquidated 8,591 of their short positions. As of the latest report, managed money is long live cattle by a ratio of 2.51:1, which is down sharply from the previous week of 3.99:1 and the ratio two weeks ago of 5.90:1.

Lean hogs: On July 22, August lean hogs generated a short-term buy signal, but remains on intermediate term sell signal.

For the week, August lean hogs gained 2.00 cents, October +57 points, December +85. The COT report revealed that managed money added 489 contracts to their long positions and liquidated 3,432 of their short positions. Commercial interests liquidated 4,647 of their long positions and also liquidated 4,903 of their short positions. As of the latest report, managed money is long lean hogs by a ratio of 1.37:1, which is up from the previous week of 1.25:1 and the ratio two weeks ago of 1.13:1.

WTI crude oil:

For the week, September WTI crude oil lost $3.07, October -2.97, November -2.88. The COT report revealed that managed money liquidated 18,662 contracts of their long positions and added 14,500 contracts to their short positions. Commercial interest liquidated 16,928 of their long positions and also liquidated 23,291 of their short positions. As of the latest report, managed money is long WTI crude oil by a ratio of 1.91:1, which is down from the previous week of 2.331:1 and a substantial drop from the ratio two weeks ago of 2.84:1.

Heating oil:

For the week, September heating oil lost 4.01 cents, October -4.75, November -5.07. The COT report revealed that managed money added 1,825 to their long positions and also added 3,423 to their short positions. Commercial interests added 2,466 to their long positions and also added 5,684 to their short positions. As of the latest report, managed money is short heating oil by a ratio of 1.71:1, which is about the same as the previous week of 1.70:1 and above the ratio two weeks ago of 1.64:1.

Gasoline:

For the week, September gasoline lost 9.50 cents, October -7.76, November -7.37. The COT report revealed that managed money added 8,022 to their long positions and also added 3,626 to their short positions. Commercial interests liquidated 2,577 of their long positions and added 3,963 to their short positions. As of the latest report, managed money is long gasoline by a ratio of 1.32:1, which is up from the previous week of 1.26:1 and the ratio two weeks ago of 1.15:1.

Natural gas:

For the week, September natural gas lost 9.9 cents, October -9.5, November -8.5. The COT report revealed that managed money added 2,575 to their long positions and liquidated 23,867 of their short positions. Commercial interests added 13,568 to their long positions also added 19,248 to their short positions. As of the latest report, managed money is short natural gas by ratio of 1.44:1, which is down from the previous week of 1.58:1 and the ratio two weeks ago of 1.71:1.

Copper:

For the week, September copper lost 11.35 cents. The COT report revealed that managed money liquidated 38 contracts of their long positions and added 4,800 to their short positions. Commercial interest added 356 contracts to their long positions and liquidated 929 of their short positions. As of the latest report, managed money is short copper by a ratio of 1.80:1, which is up from the previous week of 1.65:1 and the ratio two weeks ago of 1.73:1.

During the past week, September copper made a new contract low of 2.3505.

Palladium:

For the week, September palladium advanced $3.60. The COT report revealed that managed money liquidated 542 contracts of their long positions and added 53 to their short positions. Commercial interests added 197 contracts to their long positions and also added 36 to their short positions. As of the latest report, managed money is long palladium by a ratio of 1.64:1, which is the same as the previous week of 1.64:1, but below the ratio two weeks ago of 1.77:1.

During the past week, September palladium made a new contract low of $595.00.

Platinum:

For the week, October platinum lost $20.60. The COT report revealed that managed money added 739 contracts of their long positions and also added 1,507 to their short positions. Commercial interests liquidated 373 contracts of their long positions and also liquidated 639 of their short positions. As of the latest report, managed money is long platinum by a ratio of 1.21:1, which is down from the previous week of 1.25:1 and the ratio two weeks ago of 1.35:1.

During, the past week, October platinum made a new contract low of 946.30, which is the lowest print since January 2009. Remarkably, managed money remains long platinum even though it has substantially under performed gold.

Gold:

For the week, August gold lost $46.40. The COT report revealed that managed money liquidated 2,116 contracts of their long positions and added 10,317 to their short positions. Commercial interests added 4,485 to their long positions and liquidated 7,755 of their short positions. As of the latest report, managed money is short gold by ratio of 1.13:1, which is a substantial increase from the previous week of 1.01:1, and a complete reversal from 2 weeks ago when managed money was long gold by ratio of 1.02:1.

During the past week, August gold made a new contract low of $1,072.30.

Silver:

For the week, September silver lost 34.6 cents. The COT report revealed that managed money liquidated 2,201 of their long positions and added 3,552 to their short positions. Commercial interests added 2,080 to their long positions and also added 1,025 to their short positions. As of the latest report, managed money is short silver by a ratio of 1.36:1, which is an increase from the previous week of 1.21:1 and the ratio two weeks ago of 1.28:1.

During the past week, September silver made a new contract low of $14.33.

Canadian dollar:

For the week, September Canadian dollar lost 45 pips. The COT report revealed that leverage funds added 3,090 contracts to their long positions and also added 2,079 to their short positions.As of the latest report, leverage funds are short the Canadian dollar by a ratio of 2.05:1, which is down from the previous week of 2.21:1 and the ratio two weeks ago of 2.15:1.

Australian dollar:

For the week, the September Australian dollar lost 92 pips. The COT report revealed that leverage funds liquidated 484 contracts of their long positions and added 4,210 to their short positions. As of the latest report, leverage funds are short the Australian dollar by a ratio of 4.99:1, which is up from the previous week of 4.45:1 and a substantial increase in the ratio two weeks ago of 3.27:1.

Swiss Franc:

For the week, the September Swiss franc lost 21 pips. The COT report revealed that leverage funds added 3,365 to their long positions and also added 3,047 to their short positions. As of the latest report, leverage funds are long the Swiss franc by a ratio of 1.34:1, which is down from the previous week of 1.56:1 and a substantial drop from the ratio two weeks ago of 3.12:1.

British Pound:

For the week, the September British pound lost 1.01 cents. The COT report revealed that leverage funds added 1,478 to their long positions and also added 3,420 to their short positions. As of the latest report, leverage funds are long the British pound by a ratio of 2.39:1, which is down from the previous week of 2.64:1, but up from the ratio two weeks ago of 2.14:1.

Euro:

For the week, the September euro advanced 1.32 cents. The COT report revealed that leverage funds added 3,593 to their long positions and also added 9,895 to their short positions. As of the latest report, leverage funds are short euro by a ratio of 2.95:1, which is down slightly from the previous week of 2.97:1, but up from the ratio two weeks ago of 2.74:1.

Yen:

For the week, the September yen advanced 23 pips. The COT report revealed that leverage funds added 4,181 to their long positions also added 10,977 to their short positions. As of the latest report, leverage funds are short the yen by a ratio of 3.38:1, which is down from the previous week of 3.50:1 and the ratio two weeks ago of 4.70:1.

Dollar index:

The September dollar index lost 64 points. The COT report revealed that leverage funds added 1,389 to their long positions and also added 2,276 to their short positions. As of the latest report, leverage funds are long the dollar index by a ratio of 1.07:1, which is down from the previous week of 1.15:1, and a complete reversal from two weeks ago when leverage funds were short by a ratio of 1.10:1.

S&P 500 (250 x):

For the week, the September S&P 500 futures contract lost 41.20. The COT report revealed that leverage funds liquidated 2,634 of their long positions and added 164 contracts to their short positions. As of the latest report, leverage funds are short the S&P 500 futures contract by ratio of 2.36:1, which is almost double the ratio of the previous week of 1.22:1 and substantially above the ratio two weeks ago of 1.49:1.

10 Year Treasury Note:

For the week, the September 10 year treasury note advanced 19 points. The COT report revealed that leverage funds added 34,066 to their long positions and also added 10,906 to their short positions. As of the latest report, leverage funds are short the 10 year note by a ratio of 1.77:1, which is down from the previous week of 1.90:1 and the ratio two weeks ago of 1.80:1.