Uncle Ti 88

I have received emails from readers who asked why I trade purely based on the COT Proxy. Some have also asked me why I didn't cover stocks or instruments by looking at fundamentals such as financials ie balance sheets, profits, losses, assets, debts, dividends etc. I do trade fundamentals ie The Commitments of Traders (COT) Proxy. Basically it simulates what the commercials (smart money, big boys),  the specialists (hedge funds, investment companies) and the speculators (small traders like me) are trading. Just like the real COT report released by CFTC, it simulates the trade the commercials are taking. The commercials are the ones moving the market and we want to follow them. Hence the COT Proxy tells us what these big traders are doing. However I do not analyse stocks based on their financials. As you know financials can be manipulated. We have seen even big companies cooking the books. Enron, WorldCom anyone? Even if securities commissions or local monetary authorities tr...

Olam International - COT Proxy Olam's stock fell after Muddy Waters report that Olam is too ambitious in reporting its profit. Muddy Waters report carries a lot of weight as they shorted Sino-Forest as well as other a bunch of other companies and those companies are on the brink of closing down now. Even though the price has risen in early morning trading today, there is still a lot of downside. Based on our COT Proxy, the commercials has been shorting since early 2011 and another short signal was given in October 2011! The shorts are still in play and we got the signal way earlier than the Muddy Waters report. Stay clear of this stock until we see the commercials turn to net buyers. Don't be fooled when Olam said that they are buying back some stock. Stay clear of that bull trap statement.

Epicentre - COT Proxy         The huge run-up to 0.43 seems tempting to go long. With the recent launch of the Iphone 5seems to make the stock stop short in its decline, will the launch of the new Ipad help boost this stock? The commercials are still net short on this one. It is recommended to wait for a net long signal.

Ascendas India Trust - COT Proxy Want a piece of Indian real estate? Looks like it is not a good time to go into it now, commercials are selling. Although a rebound  might be in sight. They just reported a 20% drop in its distribution per unit to 1.20 Singapore cents for the first quarter ended June 2012.

Asia Pacific Breweries - COT Proxy It is TIGER TIME! This is one stock that everyone is watching now. A takeover battle is in the works. It all started when a Thai billionaire acquired stakes from OCBC and somehow the other shareholders get all jittery and now Heineken NV and Japan's Kirin Holdings are joining in the fun! It was reported that block trades were made this week as unknown buyers are accumulating shares. If we take a look at the COT Proxy, we know that the "big boys" or whoever they are have been accumulating since 14 June 2012 when the prices are still low at 34.50!

Cotton No. 2 Futures - Commitment of Traders Report Take a look at the disaggregated Cotton No. 2 chart. Usually the commercials aka the producers and swap dealers are moving in tandem. Both will either go long or short at roughly the same time. But for this commodity we can see that they move in the opposite direction. See the producers (blue line) and swap dealers (red line). Why is this so? Please take note also that prior to 4th September 2007, Cotton No. 2 was traded on the New York Board of Trade before switching to ICE Futures US.

Gold Disaggregated Commitments of Traders Report 12 June 2012 It is said gold traders have been bullish for the past few weeks. According to the World Gold Council, central banks are buying more gold after adding 456.4 tonne in 2011, the most in almost five decades. Above is the chart for the Disaggregated Commitments of Traders for Gold. The smart money (the Producers and Swap Dealers) have been unwinding their short positions steadily. This could mean there might be a drop in gold prices and the end of the bullish run for gold.

United States Natural Gas ETF - UNG COT Proxy Everyone is hating natural gas right now and it has not been this cheap for over 20 years (if you factor in inflation)!

Straits Times Index - STI COT Proxy The STI or Straits Times Index, a benchmark for SGX stocks is ending lower this week. The commercials are net short since May 2012.

Commitments of Traders Report - Euro FX - EURUSD It has been a while since my last post. Sorry about that. I will try and make up with a lot more posts in the coming days or maybe weeks :) Let's start off with the Euro! Greece going to exit the Euro? Looks like it... the position remains unchanged for the commercials since September 2011 and the last few weeks COT report has no significant changes. So you can maintain the short Euro position if you have one. Those trading forex can short the EUR/USD.

USD/JPY - How strong is the Yen? According to the 27 March 2012 COT Report, the futures traders are betting that the Yen will fall against the dollar and among other currencies. The Yen started the move in February this year when the Bank of Japan (BOJ) announced it would expand its asset purchase program.

Commitments of Traders Report - Euro FX - EURUSD If you are trading the EURUSD, are you following the commercials? They have been long on the Euro, hence they are expecting the Euro to come down in the coming weeks or months. They have been in that position since September 2011. Seems that there is still no confidence in the Eurozone at the moment even with whatever measures it is they are taking.

Commitments of Traders Report - Canadian Dollar Looks like the high made for USDCAD last year is short-lived. The commercials are now betting that the Canadian Dollar aka the Loonie will continue to rise. Optimism in the world economy contributes to the projection in demand for Canada's natural resources which is actually half of Canada's export revenues.

Commitments of Traders for Australian Dollar AUDUSD The growth of the Australian economy is very much dependent on its resource exports especially to China. Even though we are hearing that the Chinese economy is going to slow down, it will still be business as usual for the Aussie. The commercials are still holding the same net position level (percentage of traders) as they did exactly 3 years ago.

JES International Holdings SGX - Buy Signal Confirmed? Another request received from a reader to cover this stock again. Here it is buddy. We covered this sometime in January this year. The post is here: JES International Holdings SGX - COT Proxy - Time to Buy? . The buy signal was not confirmed then but we can see that the number of commercials net long was increasing. Recently we received the confirmed buy signal as indicated by the COT Proxy. Do take note that the commercials can be wrong sometimes. Keep the stop-loss tight.

Commitments of Traders Proxy Silver Vs ETFS Physical Silver Shares We have looked at how the prices of the Silver ETF move in relative to CFTC Commitments of Traders report. We now look at the COT Proxy. The relation is more obvious. The green line is the trigger for the COT Proxy. Anything above we go long, anything below we go short. The COT Proxy gave us the signal to go long on 23 August 2010 at the closing price of 19.03 and exit signal given on 27 June 2011 at the closing price of 33.66 (based on weekly charts).

Commitment of Traders Report Silver Vs ETFS Physical Silver Shares Chart I thought it might be interesting to impose the chart of the COT Silver Chart against a relevant instrument. We will take the ETFS Physical Silver Shares (SIVR) as the example. Do you see any correlation? It isn't that obvious isn't it? For those not familiar with ETFs, it is an access for those interested in trading or investing in Silver. The ETF try to mimic the movement of Silver prices. How exactly they do it, I am not really sure. There have been some problems with some ETFs. In some cases, the prices do not correlate with the underlying real instrument themselves / industries themselves.

Commitment of Traders Report COT CFTC - 10 Year U.S Treasury Notes - Chicago Board of Trade - 20 March 2012 A major divergence can be seen between the commercials and the large speculators and prices have edged up for the 10 year notes. Good time to go long?

Commitment of Traders Report COT CFTC - Gold - Commodity Exchange Inc - 20 March 2012 Gold has been range-bound after hitting the top. Commercials are still net short, only about 30% of them are taking long positions. However the numbers taking long positions are increasing compared to previous weeks.

Lynas Corporation - ASX - COT Proxy This will be the first time I am covering stocks on the Australian Stock Exchange (ASX). How could I have not covered them all this while? Let's take a look at Lynas Corporation. This is an interesting company. Just a little background, this is actually a mine to market integrated rare earths mining company in Australia. Their mine is in Mount Weld, Western Australia. Their processing plant where they refine the rare earths deposits is in Gebeng, Kuantan - Malaysia. The locals and opposition parties are rallying (they call themselves the "Green Movement") against the plant which is also called the Advanced Materials Processing Plant because of the emission of radiation into the environment. The plant promises to be one of the biggest plants in the world to process rare earths outside of China. This will serve to break the monopoly of the Chinese for these rare earths. The commercials aka big boys are net short since 17 Septe...

Tianma Microelectronics - Shenzhen Stock Exchange - SZSE We shall look at this Shenzhen listed stock in China. They are involved in the design and manufacturing of LCD and LCM products. Commercials are still short on this one. What is happening in the LCD market? Just heard that Samsung is going to spin off its LCD business? Probably competition from Chinese companies like this force them to do so.

Osim - SGX - COT Proxy I would define this company as a value-added health product. Need massage chairs, belly vibrators? Think Osim. The commercials are moving into being net long and prices are moving higher. Time to go U-Long?

Cosco Corporation - SGX - COT Proxy Cosco is involved in marine engineering and dry bulk shipping. Prices are edging higher from the low in November 2011. Will the optimism in the economy lift marine and shipping stocks? Usually these industries are used as a barometer for the economy as a whole. The commercials are still net short however their numbers are decreasing. Waiting for the time for them to be net long. But do take note that the commercials can come late into the game!

Biosensors International Ltd - SGX - COT Proxy A high-flying medical technology company that develops and manufactures medical devices. COT Proxy was heading down somewhere in August and became net long in September 2011 and it is continuing its rise up. Read in the SME (Small and Medium Enterprise) magazine published by the Straits Times that the company is holding some medical patents. Probably this will be a cash cow for the company. Have not read the full prospectus/annual review and I can't comment much on this. But what I do know is that it is in an uptrend!

Been away for a couple of weeks on a business trip and this will be the first post for Feb 2012. What a start it has been for 2012! Stocks are doing well even though the Eurozone problems are still far from over. We can see that the bottom was made in October 2011 last year if stocks are continuing to head up. Let's start off with stocks from Singapore Exchange - SGX!

Alstom - Euronext Paris - Stock Chart - COT Proxy Turbines, trains... a competitor to Siemens. Bon Jour... another French stock. Main trend is down, had a few false bull breakout and it starts to go down. Commercials are still net short on this one.

EADS - Euronext Paris - Stock Chart - COT Proxy Thinking of security, weapons, airplanes much? This chart is for my many French "visitors". I don't know who you are but you guys seem to like my blog so much that I get so many hits from you.... If you are looking at French stocks trading on Euronext Paris, this is one. Commercials been long on this one since Mid 2010! It is still rising while many other European stocks are taking a beating!

JES International Holdings SGX - COT Proxy - Time to Buy? I received a request to do a COT Proxy on a SGX stock JES International. This company operates a shipyard in China. I would normally avoid S-Chips stocks (China stocks that are listed in Singapore's SGX) but we will take a look at this anyway. The price have surged last week from the low of 0.145. The commercials have been right so far in this stock. As you can see when they buy price goes up and when they sell price goes down. However you can also see that they are sometimes too early or a little too late. This time the price has gone up but they are still net short. They might seem to be late to go into the buying or probably they think it might be a false bull run and they will maintain their short position...

I will like to wish everyone a HAPPY LUNAR NEW YEAR! 

Dow Jones Industrial Average DJIA Commitments of Traders Chart We have been looking at commercials all these while and how their trading positions affect prices or sometimes how prices affect their trading decisions. It will be interesting to see how the non-commercials or specialists as some call them behave in relation to market prices. Look at the bottom of the DJIA at around 11000. The non-commercials are flipping to being net short but their numbers turned bullish and the DJIA bounced from that level to start the current rally.

British Sky Broadcasting Group LSE - Commitments of Traders COT Proxy Judging by the Commitments of Traders Proxy (COT Proxy), the commercials are turning to be net short since December 2011. Going into 2012, looks like it is a good time to short British Sky Stock. Note: Commitments of Traders Report are only available for futures contracts. For other instruments that do not have the COT Report, we use a proxy to simulate the real COT report. We are able to see what positions the big boys aka commercials are taking. For a detail explanation please visit these links in the order of: 1) Power of COT Report and COT Proxy 2) COT Proxy! 3) Euro FX COT Report vs COT Proxy 4) US Dollar Index COT Report vs COT Proxy 5) COT Proxy for Stocks 6) Example: Neptune Orient Lines - NOL - SGX

Commitments of Traders Report COT CFTC - Platinum - 3 January 2012 Spot Platinum has hit a 4-week high. Long-term outlook is still bullish but we can see that the commercials are decreasing their net short position. After making the high, the price of Platinum might be in for a correction. We shall see if there are any extreme changes for the 10 January 2012 Commitments of Traders Report that will be released on Friday 13 January 2012... Friday the 13th.........

Commitments of Traders Report COT CFTC - British Pound GBP/USD - 3 January 2012 The british pound was in short-lived rally in October last year. The sellers then took control. The COT numbers released last week shows the short is losing strength. Stand-by to go long if the commercials and speculators starts to flip.

Natural Gas - NYME - COT - 3 January 2012 Where is natural gas heading? One word, DOWN! Natural gas prices has been falling since its peak in 2008. The commercials and specialists have been taking that trade ever since. If we can't go long and buy, we will sell short. How do you short natural gas if you are not trading futures? You can look into ETFs or funds. One will be the United States Natural Gas Fund, LP (UNG).

Commitments of Traders Report COT CFTC - Australian Dollar - 3 January 2012 The chart above is based on the Commitments of Traders reports released by the CFTC and it is not the COT Proxy. The signal is still to go long on the Australian Dollar. For forex traders, you might want to consider going long on the AUD/USD. As you can see the long signal was in play since 15 March 2009. This is one of the best currencies to invest in for 2012 (long) based on the current COT report.

Here are the list of stocks for SGX that the commercials are shorting: 1) Wilmar 2) UOB 3) UOL 4) Ascendas REIT 5) Cosco Corp 6) DBS 7) Genting 8) Keppel Land 9) Olam 10) SembMarine 11) SGX 12) SIA And many, many more!

Let's start off 2012 with a bang! Let us see which of the stocks we should buy in accordance to the commitments of traders proxy. What are the big boys aka the commercials buying? We shall look at some of the Singapore stocks listed on the Singapore Exchange SGX first! Commercials are buying : 1) ComfortDelGro 2) F&N 3) Golden Agri 4) Jardine C&C 5) SingTel 6) Starhub If you are looking for stocks that the commercials are shorting in SGX, well you will be spoilt for choice!

I wish all my readers a Happy New Year!