Forget random quotes - page 45
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Don't make such an active show of stupidity.
It follows from the efficient market hypothesis that it is possible to buy at a better price. Just as a dog's reflexes follow from its central and peripheral nervous system and the patterns of their work, which Pavlov studied.
That's it, shut up. Come up with your own new definitions of the wheel and theories as to why it is round.
don't you already like the schedule?
Don't you?
Hedgers are looking very good in soybeans right now)
Yes, indeed, they look much more technical on the beans.
What theories, what hypotheses? Where do you get it all from?
Books, my furry friend, we get it all from books, from those awful, stupid parallelograms with so many incomprehensible letters in them.
How about you?
It's a great chart. Especially the cyclicality of hedgers in COT is hilarious (gotta see, not a very good timeline, must be witching off). That the number of longs and shorts is about the same all the way through is a shame, of course, as it doesn't allow much use of imbalances...
Unfortunately, what you have seen is not cycling. It's just that Cip is a derivative with no real delivery. Therefore, once the current futures on it expire, all open contracts collapse and open interest drops sharply. Then the positions of the hedgers also monotonically begin to rise until the new expiration. That is, in general, they only repeat the dynamics of open interest, which is not enough to make money.
...But then you have to understand that the bigboys who hedge, and in fact arbitrage the SP500 futures against a basket of SP500 stocks, are sitting on a timeframe below the day and hence below the COT reporting timeframe. You just can't see them here, the bigboys aren't as stupid as they think they are to be so obviously picked up.
What you have described is pure speculation. They are forbidden for hedgers (that's why they are hedgers - if you want to speculate, register as a speculator and go ahead). A hedger has to have an underlying spot asset and use his hedge to bring it to the market. In addition, hedgers simply cannot drive such volume up and down. Look at their positions, it is millions of contracts (!), distributed only among 30-60 players, it is always 70-90% of the total market volume. What kind of intraday trading can we talk about with volumes like that?
Unfortunately, what you have seen is not cyclicality. It's just that Cip is a derivative instrument with no real delivery. Therefore, after the current futures on it expire, all open contracts collapse and open interest drops sharply. Then the positions of the hedgers also monotonically begin to rise until the new expiration. That is, in general, they only repeat the dynamics of the Open Interest, and it's not enough to make money.
What you described is purely speculative trading. They are forbidden for hedgers (that's why they are hedgers, if you want to speculate, register as a speculator and go ahead. A hedger has to have an underlying spot asset and use his hedge to bring it to the market. In addition, hedgers simply cannot drive such volume up and down. Look at their positions, it is millions of contracts (!), distributed only among 30-60 players, it is always 70-90% of the total market volume. What kind of intraday trading can we talk about with this kind of volume?
You write about the official side of things and all that, but there are plenty of participants who hedge as if for themselves. Anyone can do it. You can read between the lines of the Nanex press release where they made excuses for the strange drawdowns of their clients' realdata. They, by the way, also showed a liquidity dip (or rather liquidity spillover) in terms of order flow density.
The second point, and this was a surprise to me myself, turns out it is no longer the real stock that rules the index that rules the futures, but exactly the opposite. The tail wags the dog.
...Speaking of imbalances:
This time it's more "insider" soybeans. The indicator shows a net imbalance between long and short hedgerow positions wrapped in stochastic. The green circles show the extreme imbalance (from the stochastic point of view) in favour of long positions, the red ones - in favour of short ones. The correlation between the future price and the level of imbalance of the big guys for this instrument is obvious. And you don't have to go down inside the day for that at all.
Soya is fine, but it's its own part of the market, sipi another, something else. There are subtleties everywhere.