I have a question where your opinion will be highly valuable.
For past 3 months I am noticing trades where macro scores are very far apart . For example this week a good example will be NZD ( -34 ) and CAD (+30). This makes them a great pair to trade. But COTA doesn't agree. However technical analysis / trend and pull back trading shows great opportunities. And these trades come every week and macro scores at least 50-80 points apart, trend is agreeing but COTA doesn't. Should we take these trades or just ignore them because COTA is a deciding factor. Please shed some light on this topic.
Hi Obaid, This is discretionary based on the existing trades you currently have open. If you feel the opportunity arising in the week where COT doesn't agree -- is better than --any existing positions currently open, it is ok to enter those. Ideally COT will agree with all your trades, but if it doesn't it's not the end of the world. Just remember, majority of hedgefunds are not trading in the same direction as you, so the position holding period may be shorter.