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Commitments of Traders Data

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The latest batch of commitments of traders data was released on Friday so lets see what it has to say.

S&P 500 COT Data

Commercial traders got a little less bearish on the S&P 500, reducing their net bearish position by 3.4%. This is by no means bullish euphoria, but rather slow and steady reductions of short positions over the past three weeks. Small traders on the other hand are thinking that happy days are here again, jumping their net bullish positions by 10%.

Nasdaq-100 COT Data

Commercial Traders continue to shun the Nasdaq-100, with a net bearish reading of -11,508, the third most bearish reading of the year. The 1,562-contract increase was not the result of new short positions being added, but rather commercial traders dumping 3,640 long positions and only dumping 2,078 short positions. Once again small traders are bullish on technology, adding 2,468 long positions.

Dow Jones COT Data

The cot data for Dow Jones futures is a bit puzzling. Institutions had been slowly adding long positions in the Dow since 3/27/01, but last week institutions net bullish position dropped 35%. At the same time, small traders got a little less bearish, reducing their net bearish position by 2,875. This contract is thinly traded compared to the S&P 500, but if small traders are starting to favor the Dow, perhaps it is time to look elsewhere.

So in conclusion, Institutions are still bearish on the S&P 500, but by a lesser amount. Commercials look like they want nothing to do with technology, dumping both long and short position. And for the first time in two months, institutions are less bullish on the Dow.

Jeffrey Canavan

Profiling Computerized Thermal Imaging as bullish

On May 31st at 01:30 EST, PremierMarkets.com discussed shares of Computerized Thermal Imaging (AMEX:CIO) and how small cap stocks in general had been gaining favor. On May 31st, we thought shares of CIO had gotten a little overextended at $5.12, but today's pullback has given us a 3-box reversal on our point and figure chart and we find the stock attractive at current levels. PremierMarkets.com is picking up coverage of CIO and a 1/2 position in the stock for the PremierMarkets.com Profiled Portfolio at the market (currently $4.38). We will follow this profile with a stop at $3.25 and use the current bullish price objective of $7.50 from the point and figure vertical count as our bullish price objective. By using the 1/2 position strategy at this point, PremierMarkets.com reserves the right to add to this profile should the stock pull back further.

Jeff Bailey
Senior Market Technician

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