How To Trade CoT Reports

We know by now trading the currency markets is not an easy endeavor. In fact it can be common for traders to give up because they feel they are out of sync with the markets. One tool that is FREE and available to any trader is the Commitment of Trader reports. These reports give us an insight into what traders who report the CFTC are doing.  

There are currently two CoT signals that are very interesting and could give us an idea of a trading opportunity that could see price move over +350 pips. 

Swiss Franc Gaining Strength

The latest Commitment of Traders (CoT) reports are showing something big. Commercial long contracts (net) for Swiss Franc futures have hit levels we haven’t seen since June 2019. This suggests the market might be bottoming, with traders betting on a stronger CHF.

GBP A Different Story

Meanwhile, GBP futures are on the rise, hitting the 1.3000-1.3100 range. But here’s the twist: the CoT report shows commercial short contracts for GBP are at their highest since 2008. This hints that traders are expecting a drop, possibly because the Bank of England (BoE) might cut interest rates soon.

Trading GBPCHF: A Hot Opportunity

These contrasting CoT report signals make the GBPCHF pair super interesting. Recently, GBPCHF rejected a high-volume resistance zone at 1.1620. Plus, it looks like the price has moved through a bullish channel but is now showing signs of a bearish reversal.

Why GBPCHF is Worth Watching:

• Swiss Franc Strength: CoT reports are signaling extreme commercial long positions, pointing to potential CHF strength.
• GBP Weakness: With high commercial short positions in GBP futures, a bearish outlook is likely, especially if the BoE cuts rates.
• Technical Analysis: The rejection at 1.1620 and signs of a bearish reversal after a bullish channel make GBPCHF an exciting trade setup.

In short, these factors make GBPCHF a pair to keep on your radar.

Have you watched our latest video update? You can see it here. 

Enjoy low spreads and quick trade executions with a live account. Our highly committed customer support team will assist you with your quick account setup for any future concerns. Start trading with Blueberry Markets.

About The Author

Jonathan Kibbler

Jon Kibbler, our Senior Market Analyst, boasts over a decade of trading experience. He specializes in dissecting the intricacies of financial markets and sharing his expertise with precision. Jon’s insights have been featured at renowned events and platforms like Coindex, Forex Analytix, and Forex.com.

See author's posts