The Epic American Credit and Bond Bubble Laboratory Message Board

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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory

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To: rz who wrote (14670)	5/28/2004 11:57:34 PM
From: russwinter	Read Replies (1) of 110194

Yes, commercials are typically hedged (short)commodities, but what I'm looking at is the degree and size of the spec long position. Also when commercials actually go long, I take note. For instance specs being long 29,455 futures w options in corn is no big shakes, just normal for all practical purposes. 70,950 spec longs in gold isn't especially significant either, but over 200,000 was, and we ended up with problems there when it got stale. The energy subgroup at 240,093 of spec longs is inordinately large, and therefore represents quite a bit of hot money that could be liquidated (similar to what transpired in gold). It's not necessarily a short term trading indicator, but more an indication of potential volatility and downside risk.

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