Oil: speculators increased net-long by 75%

The CFTC's COT report for the week ending last Tuesday showed that, according to the Commodity Futures Trading Commission, traders had commitments.

Non-commercial large speculators increased their net buying position on oil contracts for the fifth consecutive week, bringing the total to 241.9 thousand contracts - the highest since April 18. This was an increase of 16.7 thousand contracts from the previous week.

Hedgers (COMMERCIAL) have been increasing their net sell position on oil contracts for the past five weeks, and this week was no exception. They increased their net sell position by 16.3 thousand contracts, bringing it up to 267.2 thousand.

The open interest rose by 8 thousand contracts, bringing the total to 1.752 million.

The ratio of the number of buy contracts to the number of sell contracts for the bullish index of large speculators increased by 0.18 over the course of the week, bringing it up to 2.98.

The data from the COT report indicates that traders are becoming increasingly bullish on oil prices. Over the past five weeks, the net position of large speculators has grown by 75%, reaching its highest level in the past 3.5 months. Additionally, large funds have increased their buying by 4%, while reducing their selling. If this trend continues, it could lead to an increase in oil prices.

Buyers should be cautious, as the net position has been at levels from which it has reversed multiple times in the past year.

WTI

COT report data is essential for medium and long-term trading, and is mainly used by large speculators, NON-COMMERCIAL (banks, investment funds). These speculators usually trade in the same direction as the market (blue line). Small speculators, NONREPORTABLE POSITIONS, however, have little influence on the market (red line). Hedgers, COMMERCIAL (operators, large companies) usually trade in the opposite direction of the market (black line). The net position is the difference between the number of buy and sell contracts, while open interest is the total of all open positions in the market.