The NQ Commitment of Traders (COT) is showing that leveraged traders (Hedge Funds/CTA's) have been exceeding Short positions over their Long positions over the past 2 weeks (as a percentage basis). Asset Managers have a net Long, greater percentage over same period. Asset Managers (such as Mutual Funds) tend to be primarily Long Only and typically are limited based on fund investment objective. The Yellow Vertical (dash line) did show when both asset managers and leveraged managers were heavily net short. This was followed by a 4 day rally and 1 day 900 point drop in the NQ. Since May 2nd Leveraged vs AM (percentage of total) have been spreading apart with LT's increasing from 29.6 to 35.5% and AM's decreasing from 28.2 to 23.1%. Chart below: Red line 15200 next potential upper target and turning point should this continue to widen (if not prior to hit). White MA (30 Day) 1st drop target and Blue MA (200 Day) potential 2nd. Could be drop/test or more than just a test should NQ holders start to unload and reposition to other major indexes (like Friday).
Comment:
Leveraged is winning today, may continue for a few days. The battle will start.
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Look Short under 14630 today, may see stall out - drop.
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14630 is the level to break, no pass is a Strong Short.
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Should see 14570 retest prior to Open or at Open. Range is 570 - 630.
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Lower Highs developing over past 2 days with heavy Short Interest may spark a kick start lower.
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IDS35 Range to Break Out
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Above 570, 80 May bounce to 630 for 2nd Long Test. Good Luck after Open Today.
Comment:
Drop test is done, 14325 should Hold as Support, watch level.
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White Arrow may be in Play
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NAZ hit KL 14324 and lower TL, may pop at 14250 under TL.
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White Arrow