What Is the COT Report?
The Commitments of Traders (COT) report is published every Friday by the U.S. Commodity Futures Trading Commission (CFTC). It shows the aggregate futures positioning of three distinct groups in every major market — from S&P 500 futures to crude oil to the euro.
The data is reported as of Tuesday each week and released on Friday afternoon. This slight lag means you are working with positioning that is three days old, but for macro-level analysis it remains highly useful.
The Three Groups of Traders
The COT report breaks participants into three categories:
- Commercials (Hedgers) — Companies that use futures to hedge real-world exposure. A wheat farmer selling futures to lock in a price, or an oil company hedging production. These are the “smart money” traders who are closest to the underlying asset. They are typically contrarian: they sell when prices are high and buy when prices are low.
- Large Non-Commercials (Speculators) — Hedge funds, CTAs, and institutional traders taking directional bets. These are trend followers. When the trend is strong, they pile in; when it reverses, they are often caught offside.
- Small Speculators (Non-Reportables) — Retail traders. Often the most wrong at extremes. When small specs are heavily net long, the market is frequently approaching a top.
How to Read Net Positioning
The key number is net positioning: longs minus shorts for each group. A commercial net position of -50,000 contracts means they are 50,000 contracts net short — they are hedging against a rise in price (they own the physical asset).
Look for extremes. When commercials reach a net long extreme that is historically unusual, it signals that hedgers believe prices are undervalued. When large specs reach an extreme net long position, it often precedes a reversal.
Rule of thumb: the commercials are almost always net short in commodities (they own the physical and hedge with futures). What matters is how extreme that position is relative to history.
Using COT for Trade Bias
COT data is a macro filter, not a trade entry signal. Use it to build your directional bias over a multi-week horizon:
- If commercials are at a multi-year net long extreme → bias bullish for that asset
- If large specs are at a multi-year net long extreme and commercials are heavily short → bias bearish; specs will be forced to unwind
- Combine with a price-based entry trigger (break of a key level, a momentum signal) for timing
Where to Find COT Data
Raw CFTC data is published at cftc.gov. For a cleaner view, sites like Barchart and Finviz display COT charts visually. The Zharks dashboard is being expanded to incorporate COT positioning data directly.
Start by tracking one or two markets you trade regularly — S&P 500 futures (ES) or crude oil (CL) are good starting points. Watch for positioning extremes over a 52-week window and you will quickly build an intuition for when the crowd is too far offside.