Choosing the Appropriate Category of Open Interest

This breakdown of the COT report reprises the first of the two questions raised earlier, namely which category of open interest we should consider using alongside the MIDAS tools. Since we're excluding the nonreportables, we have three options:

  1. The net positioning of the noncommercials
  2. The net positioning of the commercials
  3. The total open interest data (which, as noted earlier, is 132,017 in Table 12.2)

For a trader new to open interest data, trying to decide between these three key options, the situation is confusing. In the book-length studies of the COT report by Upperman (2006) and Briese (2008) the focus is on net commercial data with total open interest sidelined. However, in an online ...

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