My surgical strike in the euro

Swing trader John C Burford takes advantage of a temporary weakness in the very old and tired euro bear trend for a tasty 400-pip profit.

When markets hit big turning points, hedge funds which comprise the larger group of speculators are generally caught wrong-footed, pointing in the wrong direction with a huge imbalance in holdings of long versus short futures.

In other words, at major lows, they hold a huge plurality of shorts over longs and vice versa. I use this phenomenon to help me identify likely trend changes.

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CONTRACTS OF EUR 125,000Row 0 - Cell 1 Row 0 - Cell 2 Row 0 - Cell 3 Open interest: 449,508
Commitments
56,329250,1037,806348,754101,065412,889358,97436,61990,534
Changes from 10/3/15 (Change in open interest: -46,957)
-4,9427,759-17,385-20,896-35,105-45,223-44,731-3,734-2,226
Percent of open interest for each category of traders
12.555.61.777.622.591.979.98.120.1
Number of traders in each category (Total traders: 191)
49103304857112176Row 8 - Cell 7 Row 8 - Cell 8
Swipe to scroll horizontally
(Contracts of EUR 125,000)Row 0 - Cell 1 Row 0 - Cell 2 Row 0 - Cell 3 Open interest: 460,950
Commitments
50,148271,1116,291366,78894,933423,227372,33537,72388,615
Changes from 03/17/15 (Change in open interest: 11,442)
-6,18121,008-1,51518,034-6,13210,33813,3611,104-1,919
Percent of open in terest for each category of traders
10.958.81.479.620.691.880.88.219.2
Number of traders in each category (Total traders: 240)
51104305355120174Row 8 - Cell 7 Row 8 - Cell 8

John is is a British-born lapsed PhD physicist, who previously worked for Nasa on the Mars exploration team. He is a former commodity trading advisor with the US Commodities Futures Trading Commission, and worked in a boutique futures house in California in the 1980s.

 

He was a partner in one of the first futures newsletter advisory services, based in Washington DC, specialising in pork bellies and currencies. John is primarily a chart-reading trader, having cut his trading teeth in the days before PCs.

 

As well as his work in the financial world, he has launched, run and sold several 'real' businesses producing 'real' products.