Lean hogs and Australian Dollar reach all-time bullish COT extremes

Two historically unusual Large Speculator extremes lead this week’s COT review, while the New Zealand dollar, corn and Kansas City wheat add shorter-term bullish signals.

Two markets stand out in this week’s Commitments of Traders report for the same reason: Large Speculators are at all-time bullish COT extremes in both lean hogs and the Australian dollar.

That does not mean the two setups should be interpreted in exactly the same way. In lean hogs, the extreme is a medium- to long-term positioning signal that may require considerable patience. In the Australian dollar, the same type of extreme appears to be reinforcing an uptrend that is already in place. The common thread is historical rarity, not identical timing.

Lean hogs remain at an all-time bullish extreme

Lean hogs have been near the top of my Large Speculator extreme list for some time, and the latest report keeps that story firmly in place. On the classic COT report, Large Speculators remain at an all-time bullish extreme.

The most important point is that an all-time extreme is not a precise timing tool. These conditions can persist for many weeks or even months before price fully responds. That is why I would treat this as a medium- to long-term positioning signal rather than an immediate reversal call.

My interpretation remains bullish. I would expect the signal to matter more over the coming months than over the next few sessions. The strength of the reading is its historical significance; the limitation is that positioning alone does not tell us exactly when the market will reprice.

The Australian dollar extreme is supporting an existing trend

The Australian dollar is also at an all-time bullish COT extreme in Large Speculators, but the context is different. The market has already been rising since earlier this year, so the extreme is not necessarily warning of a major turning point.

Instead, I see it as evidence that the current trend may still have room to continue. COT extremes are often discussed only as potential reversal signals, but they can also reinforce an established move when positioning and price are aligned.

That distinction matters. The signal here is bullish, but the case is not that the Australian dollar must reverse sharply higher from a depressed level. The stronger interpretation is that the existing advance may remain supported over the next couple of months.

New Zealand dollar positioning is improving, but confirmation is still developing

The New Zealand dollar produced the largest weekly Commercial positioning change in this review, at 22% on the one-year, 52-week lookback. That change is bullish and suggests higher prices, although the current iCOT Scores do not provide strong confirmation.

The longer-term picture is also improving. Commercials are moving back towards bullish extreme territory after the market weakened from the previous signal. I would become considerably more confident if Commercial net positioning moved above roughly 50,000 contracts net long, with 60,000 to 70,000 contracts net long creating a much stronger case alongside the support area visible on the chart.

For now, the signal is constructive, but still developing rather than fully confirmed.

Corn and Kansas City wheat add shorter-term bullish signals

The grain markets add another layer to this week’s report. Corn shows a 15% bullish COT change signal, with iCOT Scores also leaning bullish. On the five-year view, the market is moving away from the bearish extreme seen in September, after prices subsequently cooled.

Kansas City wheat shows a 13% change, again slightly larger than average. The iCOT support is stronger here than in corn, which makes the near-term bullish interpretation somewhat cleaner. On the longer-term chart, however, positioning remains much closer to neutral than to the more significant bullish levels seen previously.

These are useful short-term signals, but they are not the same type of evidence as the all-time extremes in lean hogs and the Australian dollar.

The euro remains a patience trade

The euro is the final market I would keep on the radar. I discussed it in more detail two reports ago, and the current positioning trend still leaves room for a more meaningful bullish setup to develop.

A Commercial position around 200,000 contracts net long, combined with Large Speculators around 220,000 contracts net short, would create a materially stronger buying case in my view. Until those levels are reached, I would treat the euro as a developing setup rather than a completed signal.

That broader distinction is the main takeaway from this week’s report. Lean hogs and the Australian dollar are already at historically unusual extremes, while the New Zealand dollar, grains and euro are at different stages of development. COT analysis is most useful when those signal types are kept separate rather than compressed into one directional conclusion.

I discuss these markets in more detail in this week’s COTbase video:

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