I thought I might try something different here, and see how it goes. It's quite difficult for me to post a lot to the various topics, especially with charts, since the method I use for posting charts is very cumbersome. Some charts can take me a half hour or more to put together. Since the charts I use for posting are not my 'working' charts, this work is duplicative.

I have various ideas and thoughts here and there about different things, and if I have a 'central clearing area' where I can just put out a sentence or two, pointing to something without doing the work, the members can do what assessment and analysis they want with the ideas, and post charts if they want, preferably to the respective areas they have for that topic. This way it would leave this topic more 'clean'. If you have a question or comment on what I was pointing out you could post that in here.

Let me know if you have any thoughts on this, or anything you think would be helpful/useful. Keep in mind I am not going to just tell you all my best setups in advance, especially if I plan to trade them, as that is not 'what I do' in here, or anywhere. I want to point out things that may need some work, and might go unnoticed otherwise, or are just of interest.

Well, while everyone keeps saying this is a bottoming process in here, and it takes time, but it surely is happening, I still wonder about one thing. The commercials added to their shorts, again. If my calculations and the info I have are correct, they are now net short about 140,000 contracts (factoring in the mini's at 1/5 equivalence, which would be the mathematically correct way to do it). This is the largest net short position I have a record of. They hit about 120,000 in Mar 2000, and almost that much in Oct 2007. Small speculators are wildly long, of course.

The info I have is that in extreme net positions the commercials have never been 'wrong' even once. They also, as I have mentioned many times, tend to build a position as things go against them, since they have deep pockets and aren't trying to time it exactly. They took some heat building that 120,000 short into Mar 2000. They tend to get long to the extreme as the market finishes off its selloff into a final low. Here we are, down like 50%, and everyone saying that was it, and the commercials are not wildly net long, and haven't been taking heat building a net long into the bottom, they are the shortest they have ever been!

Keep in mind, too, after the big net short from Oct 2007, when we dropped into the previous bottom, they covered all the shorts and got a little long. This is a new position, after covering the entire one they created into the top. Down this much, and they decide to get short again, the biggest in history.

So, if this is the bottom in here the commercials are going to get killed, and the small speculators are literally going to make a mint. The commercials are actually building the largest short position ever after a 50% or so decline, not on a rising market. To me, this is profound in its implications. Hey, who knows, and it's not a timing device, but I'm going to keep watching this closely, and I thought I'd pass it on.

Well, the new COT report just hit the wires, and they added a bit more, now short about 150,000 contracts, by my data by far the shortest position ever. This, while I watch the market just keep going up and up and up today. See, I watch this and even though the movement is great for trading, in my opinion, it seems 'stupid'. While I see stupid, the commercials see this as awesome for getting a better price and getting more suckers sucked in. Perhaps they are even the ones manipulating it up (that's a cute trick, getting the market to go up as you get short yourself). It's all part of the game. Their view and play is longer-term, and the small movements don't matter, or as I posited, they give them better prices for more add-ons, and get more suckers hooked. 150,000 net short, just amazing...

Hi Jim can I ask where one gets this type of info about net long and short positions regarding commercials please, is it freely available or a paying service because as we have moved higher nyse ad/dec was enaemic to say the least so either as you said its being manipulated big time for a massive sprout of selling or they are wrong and I doubt that because I you dont take a posistion like that so one sided unless you know something and credit spreads keep widening as well whilst we hold and move higher so something is afoot guess well find out soon

I get my data straight off the Commodity Futures Trading Commission (CFTC) website. I prefer that no one put a link in here, but just Google it and go directly there. I'd rather not have the government see traffic coming from the forum, and then decide they don't want to be linked, or whatever. I would just rather stay off their radar.

Once on the home page, just look off on the right to view the Commitment of Traders reports. I look at the CME futures only short form. You can also get the historic reports on there, but as I mentioned in the last commentary from this weekend, the historic data no longer agrees with my notes that I made from when it actually happened, and I'm starting to think they recalculated all the historic data to conform to their new formula. I recall when they did the new formula the commercials had a big position, and the next week they were flat, but it didn't show a big change in their position. So, the change was because of the formula. At that point I decided the COT was probably not going to be useful any more.

I kept following when Oct 2007 seemed to be useful, and then when they hit the first bottom, but now when I look back at that data in the historic database they have, it doesn't agree with my notes from Oct 2007. So, either my notetaking is extemely poor, or data is changing. I'm not sure what is going on, but still, I want to watch net short 150,000 contracts regardless.

thx Jim hear loud and clear what you say re keeping of the radar no problem withme thx for info/

Here's an interesting article:

http://www.marketwatch.com/news/story/Ten-clues-tell-us-a/story.aspx?guid=%7B46BEE66B%2D29D6%2D4799%2D88F8%2DC6FBAD94AFAB%7D

I've been having that same thought in the last few days and I am really starting to believe that they are about to create the biggest bubble in history where housing was just the prologue.
I read a quote yesterday by Phillipe Rothschild (we know on which said they are one) that said: "When there is blood on the streets it's time to buy" or to quote one of the traders in Market Wizards (forgot his name):" Once it's on the frontpage of the news it's over".
Now that the public has been primed for the worst possible things, does it really mean all of it is going to come true? The facts say yes, but no one really seems to give a crap about facts. It's fantasy that everyone seems to live by. Printing money is part of that fantasy and imo the fact that we need paper to ensure our survival here is fantasy too....
Maybe the commercials with their record shorts are building record longs on their way down....

On the other hand I just read that the yield on 3-months treasury notes turned negative. So let met get this straight: If investors only get 99 cents for every dollar invested the feds are making all the money. Sounds like a setup to me....or maybe they just want to make their balance sheets look nice?

Yep, we are now paying the Fed to take our money...

I am having trouble beleiving the low is actually in on this first move dwn, my thinking is on bubblevision every analyst that said buy at 1400,1300,1200,1100,1000,900,800 have been bullish all the way dwn these are the same clowns that said there was no problem, bear mkt bottoms either tradable or all out lows do not come with everyone being bullish I see the news but the actual analysts are bullish yet all the above mentioned seems to be ignored, credit spreads are still widening bonds are signally deflation, so far upteen stimulus packages have done nada Paulson backed of from mortage assets because he knew before he got the tarp money they were bad but when he got it and realsised he would never have got away with buying them and leaving the US taxpayer with the bill even he realsised that was a step to far, I kow mkts cannot go staright dwn but this looks like a pre Obama inaguaration he will save us rally when other signs say otherwise, the fact he has adopted the view spend now and let everyone pay later like the clowns running the UK says to me everyone is likely to get a much bigger shock than they ever imagined history says stocks have to be hated to get to a bottom but the analyst s have been in love all the way dwn which is why I find all the above interesting but mkts are funny things they never quite let you work them out.

I think the second chart is particularly telling. I agree with the conclusion, this market is nothing more than Euro-yen carry trade on, Euro-yen carry trade off. No balance, no participation, no depth, as I discussed in my last monthly commentary, just leverage/deleverage, risk on/risk off, and that's it. Skynet is totally sentient. How long, like in the movie, until the machines decide to vaporize the useless humans?

http://www.zerohedge.com/article/tale-two-decouplings