Atilla: 10 day moving average of Equity PC and OEX PC ratios have been one of the best intermediate term indicators for years. These averages, once again, are moving in the opposite directions, indicating that smart money crowd is gradually getting bullish while retail traders are taking the opposite side, with the help of flashbacks from 2008 they are having. This divergence usually leads to an upside reversal that may possibly last for weeks.
UI: I just read Atilla's post, and want to mention about COT. In general, i usually say "ignore COT unless you really understand who the comercials are". The common misconception is to believe the commercials are smart money. That's far from the truth. That being said, there is one thing valuable to know, and that is the delta ratio. Basically when there is sudden increase or decrease of their position, it is worth paying attention, and that's what he posted. Hope that helps.
Atilla: The recent commercial activity suggests that they are less bearish than any other time since the March 2009 lows. Please note that only the big changes in COT data is what really matters, not gradual or steady positions. So their recent short covering in size can be considered as a bullish sign , at least for the ST.
No comments:
Post a Comment