Legacy COT Report – Futures Only Positions Analysis

This group includes large speculative participants, such as hedge funds, commodity trading advisors (CTAs), and other institutional traders who seek to profit from directional price moves rather than hedging risk. They typically hold long or short positions based on their market outlook, fundamental research, or technical signals. Non-Commercials are often considered the trend drivers of the futures markets, as they react quickly to changes in sentiment or momentum. When their positions become extremely net long or short, it can signal overcrowded trades or potential reversal points. Tracking their behavior helps identify where speculative enthusiasm or panic might be peaking.

Commercials represent the core participants in the physical or financial markets who use futures to manage real exposure to price risk. This group includes producers, merchants, processors, exporters, and large corporations that buy or sell commodities as part of their business operations. Their goal is not to speculate, but to lock in prices, stabilize cash flow, and protect against market volatility. When prices rise, they often increase short hedges to protect future sales; when prices fall, they may lift those hedges or go long to secure cheaper input costs. Because of this, Commercials are often viewed as the smart hedgers of the market. Their positioning frequently moves opposite to prevailing sentiment, providing a valuable contrarian signal for traders.

These are small individual traders and entities whose positions are below the CFTC reporting threshold. They do not have to disclose their holdings in detail and are grouped together as non-reportable participants. Retail traders typically trade smaller lot sizes and are often driven by emotion, news headlines, or short-term price moves, rather than institutional research or macroeconomic factors. Historically, this group tends to follow existing market trends, often entering near tops and bottoms. Because of this reactive behavior, Non-Reportables are sometimes referred to as Dumb Money, not as an insult, but as a statistical observation of crowd psychology. Monitoring their positioning provides insight into retail sentiment and helps professional traders gauge when market participation becomes one-sided or unsustainable.