What is the COT report and how do you read it?
The official count of who holds what in US currency futures. The CFTC publishes it every Friday with data from the preceding Tuesday. What each category measures?, how to read an extreme?, and how much delay it really carries?.
The COT (Commitments of Traders) report is the official count of who holds what in US currency futures. The CFTC (Commodity Futures Trading Commission) publishes it every Friday at 3:30 pm New York time, with data from the preceding Tuesday. It is free, it runs three days behind, and it is the only public, verifiable snapshot of how large participants are positioned. It does not say where price is going: it says how much position has piled up, and on which side.
What exactly does the CFTC publish?
The CFTC requires any participant above certain thresholds in US futures markets to declare their positions. Every week it aggregates those declarations and publishes them.
For currencies, the report that matters is the TFF (Traders in Financial Futures), covering financial contracts: currencies, bonds, indices. There is another report, the Legacy one, older and with different categories — if you ever compare figures and they don't line up, it is usually because the two are being mixed.
The raw data is simple: how many long and how many short contracts each category of participant holds. The difference is the net position.
Who is in each category?
The TFF splits participants into four groups:
| Category | Who they are |
|---|---|
| Dealer / Intermediary | banks and market makers; hedging their book |
| Asset Manager / Institutional | pension funds, insurers, mutual funds |
| Leveraged Funds | hedge funds, CTAs (Commodity Trading Advisors), speculative managers |
| Other Reportables | large filers who fit nowhere above |
The category almost always quoted — and the one we use — is Leveraged Funds. The CFTC defines it as hedge funds and various types of money managers, including registered trading advisors and pool operators, and states that so-called hedge funds belong there whether or not they are registered.
It is the most speculative category in the report, and therefore the most informative: these participants are not hedging an export or squaring a bank's book. They are betting.
How do you read an extreme?
The absolute number says little. Leveraged funds holding 60,000 net short contracts in yen only means something if you know what counts as a lot for the yen.
That is why it gets normalised. The usual method, and the one we use, places the current reading inside the range of the last 52 weeks:
> (current net − 52-week low) ÷ (52-week high − 52-week low) × 100
The result is a number from 0 to 100. Near 0 means positioning sits at its bearish extreme for the year; near 100, its bullish one. The middle says nothing, and that is information too.
What you are looking for is not the middle values. It is the extremes and the turns: when a heavily loaded position starts unwinding, the move tends to be fast, because closing a short means buying.
How much delay does it really carry?
It is worth being exact here, because this is the tool's real limit.
The CFTC captures data at Tuesday's close, takes three days to process it, and publishes on Friday at 3:30 pm New York time. That is a three-day minimum gap between what you see and what was true.
In practice it is usually longer. If you consume the data automatically and your system is not awake that Friday afternoon — the market closes at 5:00 pm New York, so the window is ninety minutes — the figure does not land until Monday. That makes it six days.
For a weekly figure normalised over 52 weeks, six days matter little. For trading tomorrow morning, they are everything. The COT is not an entry tool.
What does the COT not tell you?
Four limits worth holding before giving it too much weight:
It does not cover spot. These are US-listed futures. Spot is several times larger and is declared nowhere. What you see is a sample, not the census.
It does not distinguish intent. A short can be a directional bet or one leg of a larger trade whose other half never appears in the report.
It does not give timing. In July 2026 the short position against the yen sat at highs for three weeks before it broke. Anyone entering on the extreme was three weeks early.
It does not replace price. It is context on who is loaded and which way. We develop this in what following the money means in forex, alongside the other public sources you can actually consult.
Where does ForexCommand use it?
The COT feeds the FSI at a 25% weight: the net position of leveraged funds, normalised over 52 weeks, for EUR, GBP, JPY, AUD and CAD.
We do not use it as an entry signal and we do not show it as an arrow. It is one of the components answering the underlying question: what state is this currency in before I do anything? The MRS answers the same question from another angle, with retail sentiment as a contrarian signal.
The COT is slow, public and boring. None of those three is a flaw.
