Using the Net Position of the commercials we can use one common indicator that I want to show you how to construct is called the index.
The calculation is below
index = 100 x (current Net – Minimum Net) / (maximum Net – Minimum Net)
You can see it looks like the . Here i am using a period of 104 weeks.
As you can see in the chart below the Commercial activity is often in the OPPOSITE direction of the markets trends.
Last week the Commercials. were net short 131872. The last similar value was last December 2017 with a value of 128217.
We can assume “at least” a sizeable rally such as that from Dec 12 to Jan 25: 1240-1365!