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A Curious Coffee COT Report

Last week's #COT contained a curious fact: during the rally up above 200 cents the #specs actually sold rather than bought. This is contrary to what we might expect and it confirms the possibility that the lows in this #coffeemarket will be much higher than previously thought.


In the paragraphs that follow, I will provide the framework that I'm using to make this claim and then I will walk you through my logic. Please feel free to fact check me!


For those unfamiliar with the COT or Commitment of #Traders report, it is a report published by the #CFTC (Commodities and Futures Trade Commission) that states what the aggregate positions are in the market (for more information on the COT you can check out my video on the subject).



Commercials:

The default paradigm is that the commercial longs (#roasters) buy more when the price is low and the commercial shorts (#exporters) sell more when the price is high.