Bitcoin COT Report Data Work Differently

I have been following several different futures contracts in the weekly Commitment of Traders (COT) Report since 2001.  Bitcoin futures came along in December 2017, and were featured in the COT Report starting in April 2018.  So the history is not as deep as a lot of the other futures contracts I track.  One point which became clear early on is that the COT data for Bitcoin futures work differently than other contracts.

I prefer the original format data, which breaks down traders into categories of Commercial, Non-Commercial, and Non-Reportable traders.  The CFTC updated their reporting a few years ago, disaggregating the Non-Commercial category further, but I have not seen evidence that the newer categories are better.  Under the CFTC's definitions, a Commercial trader is one who produces or uses the subject commodity in his trade or business.  Non-Commercials are the large speculators (think hedge funds), and the Non-Reportable traders are ones whose position sizes are too small to be worth it for the CFTC to collect data by name.

For most futures, the Commercials are the smart money.  But in Bitcoin, few traders qualify as Commercials, so the Non-Commercial traders fill the market niche as the smart money.  What is interesting in this week's chart is that 4 weeks ago when Bitcoin prices were bottoming, these Non-Commercial traders were at an all-time record net long position.  They were early in getting to that large skewed position, but ended up being vindicated with the rally which started off of the Aug. 14, 2026 price low. 

As prices have rallied, the non-commercial traders have started to lighten up on their collective net long position.  This is very normal, and it thus far (as of last week) only takes them back to what was previously a big net long position.  A new price uptrend like we are seeing now usually carries on until these traders get all the way up to a net short position as a group, and so there is a lot of room yet to run based on that metric.

The CFTC publishes the COT Report each Friday, reflecting traders' positions held as of the preceding Tuesday.  In my Daily Edition on Fridays, I provide an analysis of relevant insights from several futures contracts' COT data.  To see samples and get subscription information, visit https://www.mcoscillator.com/market_reports/.