Industrial & Fungible Commodities Now Look Tired

Written by Al Martin Sunday, 15 November 2009 22:45

(11-15-09) Good late week trading came into the Dec. Long Bond contract as we got past last week’s series of auctions -- auctions all with good bid-to-cover ratios. The 30-year auction was considered a little weak, simply because of the yield, but the overall series of auctions were rated good or better. That resulted in a relief rally in Friday’s trade with no fresh supply coming next week. We had recommended buying the Bonds early session at 119.02, a trade that we subsequently lifted at 119.16 later in the session. We should note that the Bonds held on to most of their gains. We would expect that the Bond prices will work higher next week as the economic calendar becomes increasingly more friendly to Bonds.

     Dollars fell back Friday after the Thursday rally effort. We are seeing consistent rally efforts now in the Dollar, which is not simply a short trade like it had been. We are seeing a base being built in the Dec Dollar contract around the 7500 level. On a technical basis the Dollar is as oversold as it ever has been -- since they started printing them in 1795.

Read more: Industrial & Fungible Commodities Now Look Tired

Late Week Action Creates Tasty Trading Opportunities

Written by Al Martin Monday, 09 November 2009 02:58

(11-8-09) The Dec. Long Bond contract came down in late week trade. Early Friday morning we put out an emergency buying recommendation at 117.24, which we later sold in the day at 118.16, generating a $750 profit per contract traded in a period of 4 hours. We think Bonds are cheap again and would look to re-buy Bonds on a retest of the 118.00 area.

Read more: Late Week Action Creates Tasty Trading Opportunities

Market Reversals Present Stellar Trading Opportunities

Written by Al Martin Sunday, 01 November 2009 23:30

(11-1-09) In Thursday’s trade we saw the Dec. Long Bond contract reverse sharply under the weight of unfriendly calendar releases. We recommended buying the contract in size at 118.16 and recommended selling the Bonds at 120.00, suggesting that you would be out in Friday’s trade as we expected a snap-back rally, which is what happened with Friday's sharp upside reversal in the Bonds, generating a $1500 per contract profit in 24 hours.

Read more: Market Reversals Present Stellar Trading Opportunities

Market Volatility Increases as Speculative Bubbles Begin to Bleed Air

Written by Al Martin Sunday, 25 October 2009 21:23

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(10-25-09) Last week we saw the Dec. Long Bond contract finally weaken in Thursday and Friday trade, still presenting good buying opportunities on dips. The Bonds have held up remarkably well, but with fresh supply coming this week, it is likely that the Bonds will be further pressured. The next place we will be looking to buy the Dec Long Bond contract will be at 118.24 in Sunday night’s trade.

The Dec. Dollar contract which rallied late week -- we would expect this to continue to test the 76.30 area. We had warned that a short-covering rally in the Dollar was at hand and we think this will play out with potentially another 100 points on the upside.

The Dec. Crude Oil contract which we shorted consistently above $81in Fridays trade, covering on dollar dips, fell to a 79.64 close Friday. Once again the Oil is severely overbought and looks tired above $80.

The trade sentiment in the Dec. Gold contract continues to be exceptionally bearish. Gold was a sell-on-rally trade all week. We were consistent sellers late week above 1060 and will continue to look at the 1060 area for short–selling opportunities, covering on $5-10 dips.

The Silver continues to act weak, relative to the Gold and other metals. We were consistent short sellers of the Dec. Silver contract at 17.75 up to 17.90 in Thursday overnight session. We see that the Silver closed once again under 17.70, so continue ot short rallies above 17.80.

The Dec. Copper contract which finally did break out above $3 was able to hold a $3.02 close Friday. However we think this contract will come back under $3 in the coming week’s trade.

The March Sugar contract – we were short sellers Thursday night at 23.35, covering down on to the test of 2300 Friday. Although 23 cents held, we think that the Sugar has got lower to go

The Jan. Orange Juice contract which we had been warning that it has become severly overbought – we shorted in Thursday morning action at 119. 65, covering on Froday’s close taking out 5 cents or $750 per contract traded. We think the Juice has got further to fall.

The Jan. Lumber contract which remained unchanged at 194 in Friday’s trade, due to  exceptionally light volume, we still feel will fall back to test the 183 area.

The Grain complex strengthened midweek to come under renewed selling pressure Friday as Grain fundamentals turned more bearish with the release of the new China Wheat estimates. We continue to short the Nov. Beans on rallies. We had shorted the Beans Thursday night at 1022 and would look to any rallies to 1015 or better as shorting opportunities.

The Feb. Pork Bellies rallied Friday back to that 86 cent level, a level we would be looking at as a fresh shorting opportunity

We had been warning of overvaluation in the Dec. Coffee contract. Indeed in Friday’s trade, the Coffee broke hard, filling our 1.3995 sell-stops which were filled at 1.3975. We took 3 cents out of the contract on the close. The Coffee fundamentals are growing more bearish. We would expect more downside action in the Coffee tp test the 1.3550 level in Monday’s trade.

The Dec. Cocoa broke out above 3400 in Friday’s session WE were short sellers at 3403, taking $40 out of the contract at the close. The Cocoa remains dangerously overbought at current levels.

The Dec. Cotton contact which we have been telling you to be consistent short sellers of above 68.50 cents indeed fell back in late Friday’s trade. Our sell-stop of 67.99 filled and we took a half a penny of out of the contract. The Cotton shill looks tired.