Oil: bulls try to reverse net position from 2023 support zone

The Commodity Futures Trading Commission (CFTC) reported, for the week ending last Tuesday, that the Commitments of Traders (COT) reports showed.

Non-commercial large speculators increased their net position to purchase oil contracts by 31.1 thousand, bringing the total to 182.7 thousand. This is the first rise in net position in 11 weeks, beginning from the lowest levels since July 3.

Operator hedgers saw an increase in their net selling position of oil contracts, rising from 175.4 thousand to 195.9 thousand, a 20.5 thousand contract increase. This marks the first time in almost 10 weeks that their net selling position has grown.

The number of open contracts decreased by 71 thousand, bringing the total to 1.580 million.

The ratio of the number of contracts to buy to the number of contracts to sell for the bullish index of large speculators rose by 0.42 to 2.20 over the course of the week.

Data from the Commodity Futures Trading Commission (CFTC) shows that bullish sentiment in the oil market is on the rise. After two months of decline, traders have started to increase their net positions in anticipation of higher prices. This follows the upward trend that began in early July, when net positions began to grow. Additionally, large speculators have reduced their sales by 22% over the week, which could contribute to further price increases.

We have yet to see any openings for asset growth. To be sure that the net position has reversed, it is best to wait for the next report data, which will be available in a week.

WTI

COT reporting data is essential for medium to long term trading. Generally, large speculators, NON-COMMERCIAL (banks, investment funds) tend to follow the trend (blue line). On the other hand, small speculators, NONREPORTABLE POSITIONS, usually do not have a major impact on the market (red line). Hedgers, COMMERCIAL (operators, large companies) usually go against the trend (black line). The net position is the difference between the number of buy and sell contracts. Open interest is the total of all open positions in the market.