Markets Weekly overview for October 4 - 10

We make up a weekly medium-term trade list based on CFTC reports and technical analysis.

The overview provides a description of the technical condition of the market on the most popular financial instruments, as well as information on the large speculators’ actions according to the last COT reports and the previous period.

If you want to use CFTC reports in your trading practice, you should understand that for an objective assessment of the situation it’s not enough to have the data of the last report. The dynamic is more important, in other words, comparing the statistics of large speculators’ actions in the current period with the previous one, so we mention both values.

Key topics

• Trade list for the current week

• E-Mini S&P500 (ESZ21)

• Dollar Index (DXY)

• Euro (EURUSD)

• Swiss Franc (USDCHF)

• British Pound (GBPUSD)

• Japanese Yen (USDJPY)

• WTI Crude Oil (CLV21)

• Canadian Dollar (USDCAD)

• Gold (XAUUSD)

• Silver(XAGUSD)

• Australian Dollar (AUDUSD)

• New Zealand Dollar (NZDUSD)

• Russian Rouble (USDRUB)

• Conclusions

E-Mini S&P500 (ESZ21)

The market remains in the downtrend. The correction came to an end last week and the pullback selling opportunity was formed. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of September 23 – 28.

COT indicator increases. CFTC reports indicate that large speculators are buying and the professionals’ opinion doesn’t correspond to the market technical picture and it makes sense to reduce the position size when an entry point appears in the trend direction.

Dollar Index (DXY)

The market remains in the uptrend and the correction wave develops. A pullback buying opportunity will appear after the correction completion on the Daily timeframe. Long positions will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of September 23 – 28.

COT indicator increases. CFTC reports indicate that large speculators are buying the dollar, hedgers are selling and the professionals’ opinion corresponds to the Daily trend direction.

Euro (EURUSD)

EURUSD currency pair remains in the downtrend and the correction wave develops. A pullback selling opportunity will appear after the correction completion on the Daily timeframe. Short positions (EURUSD) will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of September 23 – 27.

COT indicator decreases. Large speculators are selling Euro and the professionals’ opinion corresponds to the market technical picture.

Swiss Franc (USDCHF)

USDCHF currency pair remains in the bullish trend and the correction wave develops. A pullback buying opportunity will appear after the correction completion on the Daily timeframe. Long positions (USDCHF) will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of September 21 – 28.

COT indicator decreases. Large speculators are selling franc and the professionals’ opinion corresponds to the Daily trend direction.

British Pound (GBPUSD)

GBPUSD currency pair remains in the downtrend and the correction wave develops. A pullback selling opportunity will appear after the correction completion on the Daily timeframe. Short positions (GBPUSD) will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of September 23 – 28.

COT indicator increases. CFTC reports indicate that large speculators are buying Pound and the professionals’ opinion doesn’t correspond to the Daily trend direction and it makes sense to reduce the position size when an entry point appears in the trend direction.

Japanese Yen (USDJPY)

USDJPY currency pair remains in the bullish trend and the correction wave develops. A pullback buying opportunity will appear after the correction completion on the Daily timeframe. Long positions (USDJPY) will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of September 20 – 22.

COT indicator reversed. Large speculators are selling Yen and the professionals’ opinion corresponds to the Daily trend direction.

WTI Crude Oil (CLX21)

The market remains in the bullish trend. The correction came to an end last week and the pullback buying opportunity was formed. Long positions will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of September 28 – 30.

COT net position indicator reversed. Large speculators are buying oil. Professionals’ opinion corresponds to the Daily trend direction.

Canadian Dollar (USDCAD)

USDCAD currency pair remains in the bullish trend. The correction came to an end last week and the pullback buying opportunity was formed. Long positions (USDCAD) will remain relevant until the market is above the nearest support level on the Daily timeframe, the lows of September 24 – 28.

COT indicator increased but didn’t reverse. CFTC reports indicate that large speculators are selling the Canadian dollar and hedgers are buying and the professionals’ opinion corresponds to the market technical picture.

Gold (XAUUSD)

The market remains in the downtrend and the correction wave develops. A pullback selling opportunity will appear after the correction completion on the Daily timeframe. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of September 20 – 23.

COT indicator decreases. Large speculators are selling gold and the professionals’ opinion corresponds to the market technical picture.

Silver (XAGUSD)

The market remains in the downtrend. The correction came to an end last week and the pullback selling opportunity was formed. Short positions will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of September 27 – 29.

COT indicator increased but didn’t reverse. At the same time, CFTC reports indicate that large speculators are selling and hedgers are buying and the professionals’ opinion corresponds to the market technical picture.

Australian Dollar (AUDUSD)

The support level was broken on the Daily timeframe on Wednesday, the trend is bearish now and the correction wave develops. A pullback selling opportunity will appear after the correction completion on the Daily timeframe. Short positions (AUDUSD) will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of September 22 – 28.

COT net position indicator decreases. Large speculators are selling and hedgers are buying. Professionals’ opinion corresponds to the Daily trend direction.

New Zealand Dollar (NZDUSD)

NZDUSD currency pair remains in the downtrend and the correction wave develops. A pullback selling opportunity will appear after the correction completion on the Daily timeframe. Short positions (NZDUSD) will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of September 23 – 28.

COT indicator increases. CFTC reports indicate that large speculators are buying and the professionals’ opinion doesn’t correspond to the market technical picture and it makes sense to reduce the position size when an entry point appears in the trend direction.

Russian Rouble (USDRUB)

USDRUB currency pair remains in the bearish trend. The correction came to an end last week and the pullback selling opportunity was formed. Short positions (USDRUB) will remain relevant until the market is below the nearest resistance level on the Daily timeframe, the highs of September 28 – October 1.

COT indicator reversed. Large speculators are buying rouble and the professionals’ opinion corresponds to the Daily trend direction.

Conclusions

In terms of medium-term trading, financial instruments with the correction close to completion on the Daily timeframe and with potentially the most promising risk-reward ratio are USDRUB, USDCAD and silver.

In the near future, AUDUSD, USDCHF, EURUSD, GBPUSD, USDJPY, NZDUSD, Dollar Index and gold can become noteworthy depending on the market correction depth.

Other financial instruments in the trade list may be also interesting, but in these markets pullback signals on the Daily timeframe are likely to occur no earlier than a week.

More information on the topic:

• The role of support and resistance levels in the trading plan

• Trading tactics. Breakout trading and pullback trading

• How to use CFTC reports in trading. General concepts

• How to use CFTC reports in trading. The logic of large speculators

Good luck in trading!