No sell off on API report today. Pulled back to 48.70 area and back upto 49.30 area. Looks like 48.70 to 50.50 will be balance area till DOE report tomorrow. Took a small long at 49.10.

Was looking at the CFTC Commitment of Traders site when I happened to see these two charts at the bottom of the page.



35% of the market controlled by 4 traders?
Almost 50% controlled by 8!

I think the keyword here is gross... But still, I have spent many dozens of minutes staring at the same data points (in text format) and just thinking of 1) how the CTFC decided that it was significant to point this out.. and 2) are these the same traders that are making my life more difficult than it needs to be.

@SMCJB

Thank you, I find it interesting that you bring this/ that up

I can make *some* sense of the /6E report but the /CL report befuddles me

I have JUN of 2014 to present entered in the below spreadsheet. What I find interesting is spec is continuously long except for a few rogue months, whilst commercial is same short. The only thing that I can garner from the com side is:

Taking CSX as an example, commercial is hedging (duh.) One diesel locomotive holds (example) 10K gallons and they have 250 locomotives that use 10K gallons a week average, minimum. They buy 10 million gallons a month. So by nature of business they are long, so sell/ hedge short.

For the spec side we throw spreads into the equation along with long/ short

Anyway that's my take on it and if you can comment, it would be much appreciatted.

If you would like a copy of the spreadsheet let me know

-Bill



EDIT

Below is from the 2-17-15 report and stays the same +/-

mfbreakout 

No sell off on API report today. Pulled back to 48.70 area and back upto 49.30 area. Looks like 48.70 to 50.50 will be balance area till DOE report tomorrow. Took a small long at 49.10.

So far move is very similar to yesterdays Euro session.

Tuesday Euro session. 3rd and final phase of the move never came through during NY session. It sure looked like it 's gonna happen as Value kept building higher all day but NO GO. I doubt that we will have 3rd phase completed today before DOE report comes out.

WilleeMac 

Taking CSX as an example, commercial is hedging (duh.) One diesel locomotive holds (example) 10K gallons and they have 250 locomotives that use 10K gallons a week average, minimum. They buy 10 million gallons a month. So by nature of business they are long, so sell/ hedge short.

I believe your CSX example is reversed.
CSX use diesel to power loco's, hence we would say that their core position is short.
To hedge their core position they would need to buy diesel (hedges) that profit in a rally.
In reality while they are short diesel, they are actually short physical diesel and not necessarily short diesel price. As long as they retain the right to adjust pricing based upon fuel cost, there is an argument that they don't actually have diesel price exposure. Once they can no longer have the right to adjust pricing, that's when they are short phys AND short price and may need a hedge. An obvious example would be CSX enter into a 5 year Coal Haulage contract with somebody at a predetermined price. As soon as they do that they should lock in prices for the amount of diesel required over the next 5 years to transport said coal contract.

Praying that CL pulls back , now that i got out. There are no signs of CL pulling back though but i did not had enough contracts on to cover some and leave the rest. Decision to cut down size at 49.18 turned out to be a BAD ONE. No complaints just poor execution. If 53.40 area get busted, i will go long on pullbacks. If 53.40 area is held during lunch slow period then getting out at 49.84 is a good trade. 48.43 to 49.30- that's quite a move and just common sense that it's time to take some rest.


NOTE: My thinking that CL may pull back to 48.80 area etc. is just a function of how much risk i had on. Apparently i had too much risk on for my risk profile. CL will do this and do that is just a function of how a trader is assessing RISK. It has no bearing on markets.

I used to spend lot of time on looking at all kinds of data for CL, COT and some very arcane stuff. The more stuff i had on my mind less trades i used to have on. Analysis- Paralysis Syndrome.

One day an experienced trader showed me this video. He was like you are like this football player agent. All the passion, analysis but no contract and let me help you etc. BS. You have no trade on but all the analysis. That was 2 years ago. I simplified stuff so much that sometimes i wonder if i am missing something.

As far as day trading futures goes, i am not missing a thing. I trade ZS, ZW, NG, KC etc all the same way. If i start reading stuff about every commodity to become an expert- i sure will hang up my trading shingle.

@mfbreakout

Yes sir I could not agree more

I try to simplify things as much as possible as often as possible

Full disclosure: my AADD will kick in now and then........ or as my wife puts it Ewwwwww Shiny

-Bill