To The Moon

This week, the crude oil market and gold-silver prices have both seen heavy volatility. Gold plunged sharply, effectively wiping out three months of gains. As for the reason behind the move, some people say Trump is once again talking too much and “drawing candlesticks with his mouth,” but today let’s dig into the data and take a closer look.

Let’s start with the COT data released by the CFTC, and we’ll also go through The Flow Show data.

First, let’s clarify two concepts: what exactly are the CFTC data and The Flow Show?

In commodity futures research, exchange-traded activity can be understood as trading futures contracts. The rules are standardized by the exchange, including contract size, quality, delivery month, and delivery location, and then the clearinghouse handles centralized clearing. ETFs, which most people are familiar with, are also exchange-traded instruments, so they belong to the on-exchange market rather than the OTC market. OTC generally refers to trades privately negotiated between counterparties, such as certain forward contracts or rollover structures. It’s important not to confuse this with the distinction between the primary and secondary markets.

Now let me explain what the CFTC data actually are. The CFTC report focuses on positioning in futures markets, and those positions are divided into reportable and non-reportable positions. Reportable positions are further split into commercial and non-commercial positions. A simple way to think about commercial positions is that they are held by industrial players, such as mines, smelters, manufacturers, and other commercial entities. Non-commercial positions are the speculative positions, such as those held by asset managers. Non-reportable positions generally represent smaller speculators.

The Flow Show, on the other hand, is not an official database. It is a weekly fund-flow and asset-allocation tracking framework published by BofA’s strategy team, with Michael Hartnett as the best-known representative. At its core, it combines EPFR fund-flow data, changes in BofA private client asset allocation, and some of BofA’s own internal indicators.

When we combine CFTC data with The Flow Show, we can use a very practical framework: first, use The Flow Show to see whether broader fund flows support a given asset; then use the CFTC data to check whether that direction has already become overcrowded in the futures market.

For example, if The Flow Show shows continued inflows into gold funds, that tells us the asset-allocation crowd is buying gold-related products. If the CFTC data also show that speculative net longs in gold are still rising, that means large players in the futures market are bullish on gold as well. In that case, the probability of further upside in gold becomes quite high. But there is an important caveat: if CFTC net longs are already very elevated, you need to be careful about a pullback, because once a macro headline hits, such as a ceasefire or the reopening of the Strait, prices can move very quickly.

There isn’t that much data in The Flow Show. The latest issue is dated March 20, so let’s run through it quickly first.

What stands out clearly is that within the most common asset-allocation buckets, gold is seeing heavy outflows, while other assets, including equities, bonds, and crypto, are seeing inflows. But there is also one very interesting detail: both equities and cash are seeing strong inflows at the same time. What does that tell us? It suggests the market is still fairly cautious. Otherwise, why would investors want to hold so much cash, an asset that does not generate yield? So overall, the market still has a clearly defensive and conservative tone.

Now let’s move on to the CFTC data.

First, the percentile indicator for total positioning.

This reflects the overall level of market interest in a given contract. The higher the reading, the hotter that commodity is. However, it does not tell you the direction of price. It only helps identify which products are more likely to see a meaningful move. From the chart, the main action is in the soybean complex. One surprising point is that ICE cotton actually has a higher total-position percentile than crude oil. That is something worth watching.

Next is the commercial net positioning ratio.

This metric reflects the share of net long positions held by producers and merchants. Under normal circumstances, the number is negative, because producers typically hedge spot exposure by shorting futures, so their shorts are usually larger than their longs. When this number turns positive, it means producers are becoming net buyers. That is often a sign that prices may be bottoming, because the people who understand the industry best are starting to turn bullish.

Now let’s look at the non-commercial net positioning ratio.

The main focus here is agricultural products. The most obvious takeaway is that the soybean complex as a whole is very hot. Soybeans, soybean oil, and soybean meal are all near the top, which suggests that capital is not just focused on one contract. Instead, money is trading the entire soybean complex as a group.

Next is the non-commercial COT indicator.

So what exactly is the non-commercial COT indicator?

In simple terms, it measures how bullish or bearish large speculative money currently is. “Non-commercial” mainly refers to funds, asset managers, and speculative institutions, so this indicator is useful for gauging how hot market sentiment really is.

What we can see is that market sentiment has become highly divided recently, and this is especially obvious in agricultural products.

Soybean oil and soybeans are currently the two hottest contracts. Soybean oil, in particular, is already close to the point where it feels like everyone is chasing the trade, and soybeans are not far behind.

Gold $Gold - main 2604(GCmain)$ $E-Micro Gold - main 2604(MGCmain)$ $FRANKLIN GOLD & PRECIOUS METALS "A" (USD) ACC(LU0496367417.USD)$ $1-Ounce Gold - main 2604(1OZmain)$ $FRANKLIN GOLD & PRECIOUS METALS "A" (HKD) ACC(LU0498741114.HKD)$

It is very clear that non-commercial positioning has declined significantly. That suggests those large pools of capital have already started cutting their gold exposure. In fact, this alone already gave an early warning that gold prices could fall this week.

sliver $Silver - main 2605(SImain)$ $E-mini Silver - main 2605(QImain)$ $Silver - Mar 2026(SI2603)$ $ProShares Ultra Silver(AGQ)$

copper $Global X Copper Miners ETF(COPX)$ $Freeport-McMoRan(FCX)$ $Southern Copper Corp(SCCO)$ $Copper - main 2605(HGmain)$

crude oil $United States Oil Fund LP(USO)$ $WTI Crude Oil - main 2605(CLmain)$ $Marathon Petroleum(MPC)$

CFTC Data Summary

These are the original data released by the CFTC. I translated them and turned them into charts for everyone, so take a look as well.​