Futures Trading based on COT Report W08-20

by Michael Chechnev | Feb 23, 2020 | Trading week results

Hello Traders,

Today is Sunday, February 23rd. summing up the results of the week we would like to start with an answer to a frequently asked question. Subscribers often ask if it is possible to use our COT-map to trade according to their own strategy.
Yes, sure. Our COT-map can be used as the basis for a trading strategy. This map is the result of the deep fundamental analysis. Every week we analyze historical data to find the setup. Also we use the seasonality factor, analyze cycles and take into account market sentiment to search for the potential trading instruments. Thus, traders can use our COT-map as a basis for their own trading strategy and their own entry points. Hot markets have already been found.
Now let’s analyze the last trading week.

Profit, $:
Swiss Franc, 3,400;
RBOB Gasoline, 1,915.
Loss, $:
Wheat, 2,062;
Cotton, 1,710.

Open positions at the end of week are:
British Pound, short position 4;
Natural Gas, long position 10;
RBOB Gasoline, long position 2.

Firstly, this is our map of COT-Setups for week 07th.

COTTON FUTURES (closed position)

SetUp to sell for Cotton was formed based on COT report in the weekly trading plan W04. At the moment, here we see a correction. Further good downward movement can be started by seasonality.

If the heights are rewritten, it is unlikely that the price will go down. If the next week is downward, then in our opinion we will have good opportunities to sell. In this case, we will look again for points to enter the short position. Momentum makes new lowlands. The chances of falling are quite high.

There were two unsuccessful attempts to sell. The loss amounted to $1,710. We’re observing the cotton and looking for entry points to the short position.


SetUp to sell for British Pound was published in the weekly trading plan W07. According to seasonality, the price is currently at the inflection point. Given the presence of a setup based on COT data, there are high chances that the price will go down. All week there was a good downward movement, but on Friday there was a correction.

There is also divergence of momentum to buy and price behavior looks like accumulation. Monday and Tuesday will be crucial days for deciding on a future strategy here. We assume that we will reduce the position or close position by zero.

SWISS FRANC FUTURES (closed position)

This is also a short setup from week 07. On the weekly chart, we see that the price approaches MA52 and bounces of it.

The position was closed to cover losses on Cotton and Wheat. We earned $3,400 here.

We are considering a new entry into the position. Another entry is in favor of seasonality and approaching MA18 and a potential rebound from it. It is possible that the price will nevertheless reach the goals set earlier as 1.008.

WHEAT FUTURES (closed position)

SetUp to sell for Wheat was published in the weekly trading plan W05. The price doesn’t really want to go in our direction 🙂 Since the formation of the setup, the price hasn’t rewritten weekly heights, but last week the peak was rewritten. We closed this trade with a loss of $2,062. The small account also has the loss of $137.
In order for us to start looking for new entry points for a short position, the price should close below MA18. We observe the instrument.

GASOLINE FUTURES (open position)

Here we chose the most strong instrument from energy sector. We have a setup for Crude Oil, Heating oil and Natural Gas. At the time of the analysis, Gasoline was the strongest. We took it for trade. We often take deals for which there are no setups, but which are correlated within the sector.
Gasoline has good up seasonality.

We closed part of the position to reduce the risk of the overall portfolio. Profit is $1,915.

We keep the second part of the position. There are no signals of a reversal here.

NATURAL GAS FUTURES (open position)

This is the long deal. There is a strong downtrend, but look at the seasonality. Seasonal growth is possible. There was a failure on Thursday, but Friday purchases give hope that the price will go by seasonally. Stop loss is placed below 02/11. If there are no impulses at the beginning of the week, then to reduce risks, we will need to close part of the position. We will make these decisions on Tuesday or Wednesday.


Here we see that the index is growing. Next week we will also prefer long trades.

To sum up the trading week:
Swiss Franc, profit $3,400
RBOB Gasoline profit $1,915
Wheat loss $2,062
Cotton loss $1,710
Total profit $1,543.

That’s all about our trading in this week.
Next, we are moving to planning trading week 09.

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