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The time frame for this week’s Commitments of Traders report is from Wednesday, October 1 through Tuesday, October 7.

Soybeans:

For the week, November soybeans advanced 10.25 cents, January 2015 +10.00, March 2015 +10.25. The COT report revealed that managed money liquidated 1,337 contracts of their long positions and added 13,853 to their short positions. Commercial interests liquidated 7,358 contracts of their long positions and added 10,026 to their short positions. As of the latest report, managed money remains long soybeans by ratio of 1.24:1, which is down from the previous week of 1.45:1 and the ratio of 2 weeks ago of 1.30:1. Three weeks ago, managed money was long soybeans by ratio of 1.24:1.Commercial interests remain long by a ratio of 1.22:1, but this is down from the previous week of 1.31:1 and the ratio of 2 weeks ago of 1.30:1.

The USDA in their supply and demand report estimated bushels per acre and 47.1, which is up from last month’s 46.6. They estimated total production at 3.927, which is up from last month’s estimate of 3.913. They decreased acreage by 700,000 bushels.It appears the US is heading for the largest soybean crop on record.

Soybean meal:

For the week, December 2014 soybean meal advanced $12.20, January 2015 +10.10, March 2015 + 8.60. The COT report revealed that managed money liquidated 2,827 contracts of their long positions and added 3,075 to their short positions. Commercial interests liquidated 182 contracts of their long positions and also liquidated 1,376 of their short positions. As of the latest report, managed money is long soybean meal by ratio of 1.78:1, which is down substantially from the previous week of 2.03:1 and the ratio of 2 weeks ago of 2.20:1.

The current ratio of 1.78:1 is the lowest since the beginning of the bear market.

Soybean oil:

For the week, December soybean oil advanced 2 points, January 2015 +3, March 2015 +2. The COT report revealed that managed money liquidated 723 contracts of their long positions and also liquidated 10,434 of their short positions. Commercial interests liquidated 1096 contracts of their long positions and added 10,542 to their short positions. As of the latest report, managed money is now long soybean oil by ratio of 1.04:1, which is a complete reversal from the previous week when they were short by ratio of 1.10:1 and the ratio of 2 weeks ago when managed money was short by 1.09:1.

Corn: On October 9, December corn generated a short-term buy signal, but remains on an intermediate term sell signal.

For the week, December corn advanced 10.75 cents, March 2015 +10.50, May 2015+10.75. The COT report revealed that managed money liquidated 613 contracts of their long positions and added 11,357 to their short positions. Commercial interests added 13,335 contracts to their long positions and also added 24,706 to their short positions. As of the latest report, managed money is long corn by ratio of 1.22:1, which is down from the previous week of 1.28:1 and the ratio of 2 weeks ago of 1.34:1.

The current ratio of 1.22:1 is the lowest during the current bear market.

The USDA estimated a harvest of 174.2 bushels per acre, which was up from last month’s estimate of 171.7. Additionally, total production was increased to 14.475 billion bushels up from last month’s 14.395 billion bushels. The USDA cut acreage by 700,000 and many in the trade were expecting a much larger loss.

Chicago wheat:

For the week, December Chicago wheat advanced 12.75 cents, March 2015 +12.50, May 2015+10.00. The COT report revealed that managed money liquidated 2,664 contracts of their long positions and also liquidated 2,886 of their short positions. Commercial interests liquidated 2,358 contracts of their long positions and added 2,412 to their short positions. As of the latest report, managed money remain short Chicago wheat by ratio of 1.80:1, which is up slightly from the previous week of 1.77:1, but down from the ratio of 2 weeks ago of 1.91:1.

The USDA estimated bushels per acre at 43.8 and that ending stocks would be 654 million bushels down from 698 million bushels last month. Harvested acres were estimated at 46.5 million acres and total production of 2.035 billion bushels.This is mildly constructive for wheat, but the export picture remains abysmal and is trailing last year and the 5 year average.

Kansas City wheat:

For the week, December Kansas City wheat advanced 9.75 cents, March 2015 +10.00, 2015+8.25. The COT report revealed that managed money added 1,309 contracts to their long positions and also added 1,612 to their short positions. Commercial interests added 903 contracts to their long positions and also added 1,148 to their short positions. As of the latest report, managed money is long Kansas City wheat by ratio of 1.22:1, which is down slightly from the previous week of 1.24:1 and the ratio of 2 weeks ago of 1.23:1.

Thus far in the 4th quarter, December Chicago wheat is the out performer with a gain of 4.34%, December corn +4.13%, December soybean meal +4.05%, December Kansas City wheat +3.54%, November soybeans +1.01%, December soybean oil +0.22%.

Year to date, December soybean meal is the out performer with a loss of 11.09%, December Kansas City wheat -13.67%, November soybeans -18.72%, December soybean oil -19.04%, December Chicago wheat -22.17%, December corn -25.82%.

Cotton:

For the week, December cotton advanced 1.63 cents, March 2015 +74 points, May 2015+1.18 cents. The COT report revealed that managed money added 4,218 contracts to their long positions and liquidated 2,976 of their short positions. Commercial interests liquidated 3,787 contracts of their long positions and added 2,904 to their short positions. As of the latest report, managed money is long cotton by ratio of 1.08:1, which is a complete reversal from the previous week when they were short by a ratio of 1.12:1. Two weeks ago, managed money was long by ratio of 1.15:1.

Apparently, managed money cannot make up its mind whether they want to be long or short cotton. December cotton remains on a short and intermediate term sell signal.

Sugar #11:

For the week, March 2015 sugar advanced 11 points, May 2015+13, July 2015 +20. The COT report revealed that managed money liquidated 10,200 contracts of their long positions and also liquidated 18,562 of their short positions. Commercial interests liquidated 15,546 contracts of their long positions and also liquidated 4,360 of their short positions. As of the latest report, managed money is short sugar by ratio of 1.27:1, which is down slightly from the ratio of 2 weeks ago of 1.30:1 (which has been the highest during the current bear market), but above the ratio of 2 weeks ago of 1.19:1.

Coffee:

For the week, December coffee advanced 13.90 cents, March 2015 +13.90, May 2015+14.00. The COT report revealed that managed money added 2,434 contracts to their long positions and liquidated 963 of their short positions. Commercial interests added 1,564 contracts to their long positions and also added 6,095 to their short positions. As of the latest report, managed money is long coffee by ratio of 8.18:1, which is above the previous week of 6.66:1 and dramatically above the ratio of 2 weeks ago of 4.91:1.

Cocoa:

For the week, December cocoa advanced $101.00, March 2015 +87.00, May 2015+78.00. The COT report revealed that managed money liquidated 12,450 contracts of their long positions and added 230 to their short positions. Commercial interests added 947 contracts to their long positions and liquidated 14,000 contracts of their short positions. As of the latest report, managed money is long cocoa by ratio of 4.01:1, which is down from the previous week of 4.64:1 and the ratio of 2 weeks ago of 4.83:1.

The current ratio of 4.01:1 is the lowest since the COT report of September 2 when managed money was long cocoa by ratio of 3.93:1.

Thus far in the 4th quarter, December coffee is the out performer with a gain of 13.99%, December cotton +4.45%, March 2015 sugar +0.61%, December cocoa -4.33%.

Year to date, December coffee is the out performer with a gain of 83.51%, December cocoa +16.41%, March 2015 sugar -6.76%, December cotton -18.27%.

Live cattle:

For the week, December live cattle lost 57 points, February 2015 -55, April 2015 +87. The COT report revealed that managed money liquidated 624 contracts of their long positions and also liquidated 4,379 of their short positions. Commercial interests added 348 contracts to their long positions and also added 9,092 to their short positions. As of the latest report, managed money is long live cattle by ratio of 12.17:1, which is up substantially from the previous week of 8.49:1 and the ratio of 2 weeks ago of 9.35:1.

Lean hogs:

For the week, December lean hogs advanced 1.38 cents, February 2015 +57 points, April +20. The COT report revealed that managed money added 2,215 contracts to their long positions and also added 2,192 to their short positions. Commercial interests added 1,134 contracts to their long positions and also added 655 to their short positions. As of the latest report, managed money remains long lean hogs by ratio of 6.04:1, which is down from the previous week of 7.21:1 and the ratio of 2 weeks ago of 6.74:1.

Thus far in the 4th quarter, December  live cattle is the out performer with a gain of 1.22%, February 2015 live cattle +0.89%, February 2015 lean hogs +0.63%, December 2014 lean hogs -0.32%.

Year to date, December live cattle is the out performer with a gain of 25.39%, February live cattle +24.91%, December lean hogs +18.74%, February lean hogs +13.25%.

WTI crude oil:

For the week, November WTI crude oil lost $3.92, December – 3.56, January 2015 -3.14. The COT report revealed that managed money added 693 contracts to their long positions and also added 8,677 contracts to their short positions. Commercial interests added 17,128 contracts to their long positions and also added 27,529 to their short positions. As of the latest report, managed money is long WTI crude oil by ratio of 3.73:1 which is down from the previous week of 4.23:1 and down slightly from the ratio of 2 weeks ago of 3.75:1.

This past week, November WTI crude oil made a new contract low at 83.59, December 82.80, January 2015 82.41.

We continue to be astounded by the continued backwardation in front month WTI crude oil in what is without question one of the worst bear markets of the past couple of years. In Friday’s trading, November WTI advanced 5 cents, but some of the forward months advanced less than November, or in many cases lost a couple of cents.As of Friday’s close, the November 2014-November 2015 spread closed at a $2.24 premium to November. In short, the market is demanding a premium for nearby crude versus crude deliverable in approximately one year.

Remarkably, this spread has not made a new low for the move even though nearby crude oil is making new contract lows.For example, the low for the spread occurred on September 10 when November 2014 WTI crude oil closed at a $1.41 premium to November 2015. This is the lowest for the spread going back to March 11, 2014. On September 10, November 2014 WTI crude oil closed at 90.84.

In short, as the November contract declined in price, the spread between November 2014 in November 2015 has actually widened. Although talk throughout the financial press is that there is a massive glut of crude oil and terrible consumption, crude oil spreads are telling a very different story. The bear market may have further to go, and as a consequence the term structure may eventually move into contango. However with WTI prices at the lowest level since July 2012, The spread continues to trade in a robust positive fashion.November WTI remains on a short and intermediate term sell signal, but we discourage bearish positions.

Heating oil:

For the week, November heating oil lost 5.61 cents, December -5.93, January 2015 -5.99. The COT report revealed that managed money added 515 contracts to their long positions and also added 559 to their short positions. Commercial interests added 3,165 contracts to their long positions and also added 1,908 to their short positions. As of the latest report, managed money remains short heating oil by a ratio of 1.97:1, which is down slightly from the previous week of 1.99:1, but up slightly from the ratio of 2 weeks ago of 1.90:1.

This past week, November heating oil made a new contract low at $2.5035 and January 2015, 2.5123.

Gasoline:

For the week, November gasoline lost 12.10 cents, December -9.17, January 2015 -7.65. The COT report revealed that managed money added 4,692 contracts to their long positions and liquidated 5,517 of their short positions. Commercial interests added 4,007 contracts to their long positions and also added 7,568 to their short position. As of the latest report, managed money remains long gasoline by ratio of 1.56:1, which is up from the previous week of 1.24:1 and the ratio of 2 weeks ago of 1.32:1.

Natural gas: On October 10, November natural gas generated a short-term sell signal and remains on an intermediate term sell signal.

For the week, November natural gas lost 18.0 cents, December -16.8, January 2015 -15.0. The COT report revealed that managed money liquidated 15,963 contracts of their long positions and added 3,593 to their short positions. Commercial interests added 4,354 contracts to their long positions and liquidated 3,003 of their short positions. As of the latest report, managed money remains long natural gas by ratio of 1.04:1, which is down from the previous week of 1.13:1 and the same as the ratio of 2 weeks ago of 1.04:1.

Thus far in the 4th quarter, November ethanol is the out performer with a gain of 1.46%, November heating oil -3.72%, December Brent crude oil -5.74%, November natural gas -6.37%, November WTI crude oil – 6.58%, November gasoline -7.91%.

Year to date, November ethanol is the out performer with a loss of 3.68%, November natural gas -8.11%, November WTI crude oil -8.39%, November gasoline -13.93%, November heating oil -14.47%, November Brent crude oil -15.33%.

Copper:

For the week, December copper lost 3.65 cents. The COT report revealed that managed money added 1,272 contracts to their long positions and also added 1,106 contracts to their short positions. Commercial interests added 3,511 contracts to their long positions and also added 2,409 to their short positions. As of the latest report, managed money remains short copper by a ratio of 1.64:1, which is down slightly from the previous week of 1.67:1, but above the ratio of 2 weeks ago of 1.39:1.

Palladium:

For the week, December palladium advanced $30.50. The COT report revealed that managed money added 67 contracts to their long positions and liquidated 313 of their short positions. Commercial interests liquidated 127 contracts of their long positions and also liquidated 980 of their short positions. As of the latest report, managed money remains long palladium by ratio of 7.17:1, which is up from the previous week of 6.45:1, but down from the ratio of 2 weeks ago of 7.55:1.

Platinum:

For the week, January platinum advanced $34.70. The COT report revealed that managed money added 2,578 contracts to their long positions and liquidated 935 of their short positions. Commercial interests added 271 contracts to their long positions and also added 2,424 contracts to their short positions. As of the latest report, managed money is long platinum by ratio of 2.30:1, which is up from the previous week of 1.96:1 and slightly below the ratio of 2 weeks ago of 2.34:1.

This past week, January 2015 platinum made a new contract low of 1186.50.

Gold:

For the week, December gold advanced $28.80. The COT report revealed that managed money liquidated 1,200 contracts of their long positions and also liquidated 140 of their short positions. Commercial interests added 2,174 contracts to their long positions and also added 1,289 to their short positions. As of the latest report, managed money remains long gold by ratio of 1.37:1, which is approximately the same as the previous week of 1.38:1 and the ratio of 2 weeks ago of 1.38:1.

This past week, December gold made a new contract low at $1183.30.

Although December gold made a new contract low at 1183.30, the market rallied smartly and closed higher on the week, which is the first time this has occurred since the week of August 25. Additionally, the December contract closed at $1221.70, which is the highest weekly close since the week of September 8 (1231.50). The contract low was the lowest print on the weekly continuation chart since the week of December 30 (1181.40).The previous low on the weekly continuation chart occurred during the week of June 24, 2013 when gold made a low of 1179.40.

In short, gold is near its inflection point, and if support going back to June 2013 is broken, the next area of support for gold is the 1155-1156 area, the lows during May 2010-July 2010.The low for 2010 occurred during February when gold printed 1045.20.

Gold topped out the week of September 5, 2011 (1920.80) and the market has been on a downward path ever since.However, the downtrend began to accelerate during early October 2012, and after making the low (1,179.40) during the week of June 24, 2013, gold has made a series of lower highs on the weekly and monthly charts, although it has not made lower lows. At some point, the market will turn around, but speculators must keep in mind gold has been in a three-year bear market, and a move from bear to bull may take quite some time.

Silver:

For the week, December silver advanced 47.2 cents. The COT report revealed that managed money liquidated 1,200 contracts of their long positions and also liquidated 835 their short positions. Commercial interests liquidated 1,280 contracts of their long positions and also liquidated 1,967 of their short positions. As of the latest report, managed money remains short silver by ratio of 1.07:1, which is fractionally higher than the previous week of 1.06:1 and above the ratio of 2 weeks ago of 1.03:1.

Thus far in the 4th quarter, December silver is the out performer with a gain of 2.21%, December palladium +1.43%, December gold +1.20%, December copper +0.83%, January 2015 platinum -2.97%.

Year to date, December palladium is the out performer with a gain of 8.72%,December gold +1.45%, January 2015 platinum -8.43%, December copper -9.58%, December silver -10.96%.

Canadian dollar:

For the week, the December Canadian dollar advanced 37 pips. The COT report revealed that leveraged funds added 5,621 contracts to their long positions and also added 9,500 contracts to their short positions. As of the latest report, leveraged funds are short the Canadian dollar by ratio of 1.75:1, which is fractionally below the previous week of 1.76:1, but above the ratio of 2 weeks ago of 1.65:1.

Australian dollar:

For the week, the December Australian dollar advanced 40 pips. The COT report revealed that leveraged funds liquidated 8,404 contracts of their long positions and added 13,488 contracts to their short positions. As of the latest report, leveraged funds are short the Australian dollar by ratio of 1.08:1, which is a complete reversal from the previous week when they were long by a ratio of 1.65:1. Two weeks ago, leveraged funds were long the Australian dollar by ratio of 2.36:1.

The current short ratio is the first time we have seen leveraged funds net short the Australian dollar in at least several months.

Swiss franc:

For the week, the December Swiss franc advanced 1.05 cents. The COT report revealed that leveraged funds added 2,818 contracts to their long positions and also added 3,382 to their short positions. As of the latest report, leveraged funds are short the Swiss franc by ratio of 1.73:1, which is down from the previous week of 1.84:1 and the ratio of 2 weeks ago of 2.18:1.

British pound:

For the week, the December British pound advanced 92 pips. The COT report revealed that leveraged funds liquidated 9,980 contracts of their long positions and also liquidated 5,607 contracts of their short positions. As of the latest report, leveraged funds are long the British pound by ratio of 2.52:1, which is above the previous week of 2.39:1 and the ratio of 2 weeks ago of 2.00:1.

Euro:

For the week, the December euro advanced 1.04 cents. The COT report revealed that leveraged funds liquidated 5,690 contracts of their long positions and added 1,382 contracts to their short positions. As of the latest report, leveraged funds are short the euro by ratio of 2.76:1, which is up from the previous week of 2.50:1 and the same as 2 weeks ago (2.76:1).

Yen:

For the week, the December yen advanced 172 pips. The COT report revealed that leveraged funds liquidated 7,715 contracts of their long positions and also liquidated 12,722 contracts of their short positions. As of the latest report, leveraged funds are short the yen by ratio of 4.21:1, which is up substantially from the previous week of 3.66:1, but only slightly above the ratio of 2 weeks ago of 4.09:1.

Dollar index:

For the week, the December dollar index lost 79 points. The COT report revealed that leveraged funds added 260 contracts to their long positions and liquidated 626 of their short positions. As of the latest report, leveraged funds are long the dollar index by ratio of 1.02:1, which is a complete reversal from the previous week when they were short by ratio of 1.002:1. Two weeks ago, leveraged funds were long the dollar index by ratio of 1.16:1.

Thus far in the 4th quarter, the December yen is the out performer with a gain of 1.81%, December Canadian dollar -0.045%, December dollar index – 0.046%, the December euro -0.13, December Australian dollar -0.33%, December Swiss franc -0.34%, December British pound -0.90%.

Year to date, the December dollar index is the out performer with a gain of 6.60%, December Australian dollar -0.64%, December yen -2.49%, December British pound – 2.84%, December Canadian dollar -4.59%, December Swiss franc -7.51%, December euro -8.53%.

S&P 500 (250x):

For the week, the December S&P 500 futures contract lost 66.00 points. The COT report revealed that leveraged funds added 315 contracts to their long positions and also added 8,987 to their short positions. As of the latest report, leveraged funds are short the S&P 500 futures contract by ratio of 3.16:1, which is more than double the previous week’s ratio of 1.53:1 and more than triple the ratio of 2 weeks ago of 1.02:1.

Thus far in the 4th quarter, the Dow Jones Industrial Average cash index is the out performer with a loss of 2.93%, S&P 500 cash index -3.35%, New York Composite cash index -3.83%, Russell 2000 cash index -4.39%, NASDAQ 100 cash index -4.41%, S&P 400 cash index-4.84%.

Year to date, the NASDAQ 100 cash index is the out performer with a gain of 7.76%, S&P 500 cash index +3.13%, Dow Jones Industrial Average cash index – 0.20%, New York Composite cash index -1.03%, S&P 400 cash index -2.83%, Russell 2000 cash index -9.48%.

10 Treasury Note: On October 8, the December 10 Treasury Note generated a short and intermediate term buy signal.