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Yes, you are reading this correctly. Both indices tell us the same thing, but you need to understand the type of traders that each index consists of in order for the readings to make sense. The speculators portion of the COT consists of hedge funds, commodity funds, and large traders. These traders are trend following in nature. Therefore, their positioning will move with price. The SSI consists of smaller retail traders. Retail traders try to pick tops and bottoms. Therefore, they will be wrong most of the time as they continually fade the trend. However, at the turn, the SSI will be extreme and speculators are on the correct side. Once the trade begins moving in the retail trader's direction, that trader will take a small profit and begin fading the move yet again (and be wrong again). The retail trader trades like the commercial hedger. Of course, the hedger can afford to do this because of enormous pockets. You'll see on the chart below how the COT and SSI mirror each other. Again, COT consists of trend followers and SSI consists of trend faders. Both sentiment indicators tell us the exact same thing from a psychological standpoint at extremes.
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