Topic 12: COT — Commitment of Traders (The Footprint)

What is COT on Footprint

• COT = Commitment of Traders = the precise price level in the bar where the most buyers and sellers are
• Also called POC (Point of Control) within a single candle
• Shows where exactly in the candle the most volume was traded
• Tells us where demand overcame supply (or vice versa)
• Normal candlestick charts cannot show this

COT Position Rules

COT at BOTTOM of candle + candle CLOSED HIGHER = BULLISH

• Strong passive buyers present
• Buyers willing to buy all the supply sellers were offering
• All selling pressure was met with buyers

COT at BOTTOM of candle + candle CLOSED at LOWS = could go LOWER

• Sign that price could continue down

COT in MIDDLE of candle = NEUTRAL

• Price is indecisive

COT at TOP of candle + candle CLOSED LOWER = BEARISH

• Lots of trading activity at the top but price couldn't go higher
• Sellers overwhelmed buyers at the high

Example: Failed Rally

• Market tried to rally, lost steam
• Only 1 lot traded at the high
• Selling imbalance just below the high
• Market sold off, closed on its low
• COT appeared near the bottom — big buyer was aggressively sold into
• Result: selling imbalance

How to Use COT

• NOT an indicator by itself
• Use to CONFIRM a move on the market
• Use when not sure which way market is heading
• Use as confirmation for taking a trade

Images

Homework

Send 2 charts where COT clearly indicates where price is likely to go.

Key Takeaway for Bot

• COT position within the candle = directional bias indicator
• Bot should track where VPOC sits relative to candle open/close
• COT at bottom + bullish close = buy confirmation
• COT at top + bearish close = sell confirmation
• This maps directly to the gold lessons: institutions loading at specific price levels