NOTE! This site uses cookies and similar technologies.

If you not change browser settings, you agree to it. Learn more

I understand
Some setups lead us to believe that, in the medium term, there is a possible long opportunity on May 2016 Cotton Futures.


Looking at the daily chart, we can see that the price is testing the latest low, facing a support level.
Yesterday candle is an hammer that, according to the Volume Spread Analysis, can also be defined as a stopping volume.

cotton may16 hammer stopping volume vsa trading for purpose

Commitment of Traders

If we look at the COT Index, the commercials bullish stance (and the fact that the small speculators, on the contrary, are overly short, and as we know small speculators are often wrong...) could confirm our guess. Also the disaggregated COT, that we aren't showing here, shows a strong bullish stance by the side of 'producers'.

cotton may16 commitment of traders cot trading for purpose

Put/call ratio

Also the Put/Call Ratio, which is currently located around 0.27, gives us a bullish hint.


The only controversial issue is related to the cotton seasonal trend. The 5 and 10 years seasonal charts show that usually cotton marks a top around the end of march/beginning of april. This leads us to an attitude of caution, although this year the cotton has not followed the usual seasonal pattern at all. Nevertheless, as we said, here seasonality is a little bit controversial.

Remember: this is not a trade solicitation and, if you decide to trade, you do it at your own responsibility.

Several setups suggest that E-mini S&P 500 Index March 2016 Futures might have reached a bottom and could be ready to reverse.

Volume Spread Analysis

Looking at patterns, we can see a noticeable hammer on a support which, according to the Volume Spread Analysis, can be defined as a 'stopping volume' bar. This is a very strong VSA signal.

standard and poors index futures stopping volume vsa trading for purpose

New lows extreme level

If we look at the chart showing the NYSE 'new lows', we can see that the peaks (at three different levels) coincide with the Index turning points.
Currently the 'new lows' are at a top level and this is another hint of a possible reversal.

standard and poors index futures new lows high trading for purpose

Total volume

Also the NYSE 'total volume' is a valuable indicator to assess the trend of E-mini S&P 500 Index Futures: when there are extreme volume peaks, we can often expect a market reversal.
This situation occurred several times in the past, as we can see from this chart, and it's arising once again right now. 

standard and poors index futures composite total volume trading for purpose

Three very pronounced setups that lead us to enter long.
According to the Fibonacci Retracements, we can presume three possible targets: 1908 or 1940 or even 1970.
Remember: this is not a trade solicitation and, if you decide to trade, you do it at your own responsibility.

Seguici su Twitter


Trading for Purpose RT @AheadoftheNews: NYSE adv/dec past 2 days. Note the strong opens which deteriorate as day progresses. distribution.…
Tuesday, 20 March 2018 06:37
Trading for Purpose RT @ttp_mailus: Cronos Group ($CRON) flies high in Wall Street. Apparently the cannabis business pleases investors. cannabis weed Medic…
Friday, 09 March 2018 10:43
Trading for Purpose RT @ttp_mailus: FOX has just won an Oscar for 'The Shape of Water'. Is the newly formed trading range a distribution or a riaccumulation?…
Monday, 05 March 2018 12:17
Trading for Purpose RT @ttp_mailus: The results of Italian elections begin to clear up and the FtseMib index struggles not to collapse. The ascending channel,…
Monday, 05 March 2018 11:12
Trading for Purpose RT @ttp_mailus: Usually the oil stocks index turns slightly earlier than crude oil itself. Recently XLE (blue line) turned south at end of…
Thursday, 01 March 2018 14:21