End of Quarter Portfolio & Fund Adjustments Create Choice Trading Opportunities
Written by Al Martin Sunday, 04 October 2009 21:46
(10-4-09) Last week we took advantage of the typical end of
3rd Quarter volatility that was created when commodity funds come in
to buy commodities that they have the largest positions in and will sell commodities
that they own the least of -- in order to
finance their purchases.
Consequently we were initially long the Gold and the Copper, knowing that the funds already loaded up with Gold and Copper, would push it higher -- which is exactly what happened midweek. Then we made a short-sellers’ tasty and always profitable “Reverse End of Quarter Trade,” wherein we went short the Gold, the Copper, the Sugar, and the Beans in Wednesday night trade. Indeed you see that the Sugar fell back and was a very tasty short trade in both Thursday’s and Friday’s trade. We see that the Beans got hit hard Friday in line with our Thursday night prediction, as the counter-reaction to end of quarter portfolio commodity fund adjustment played out. This is a phenomenon that professional traders have long recognized and will attempt to take advantage of at the end of every quarter.
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Market Dynamics Turning More Bearish
Written by Al Martin Sunday, 27 September 2009 22:11
(9-27-09) NOTE: Serious professional traders should email us
for details of our enhanced trading services.
In Friday’s trade, we saw the Dec. Long Bond contract lift
one whole point in line with our Thursday night predictions. Indeed we
recommended buying the Bonds Thursday night at 120.02, and we hung onto the
Bonds until our sell order of 120.30 was reached in late Friday trade, taking
down 7/8ths of a point out of the trade, which is $1875 profit per contract.
This was a low-risk trade in that we were coming off an auction week wherein Treasury auctions were all rated good or better. Next week we have no fresh supply and with downside pressure in the equity markets Friday, it was a done deal, as they say, that the Bonds would rally.
Best Trading Opportunities in Six Months Will Appear in Coming Week’s Trade
Written by Al Martin Sunday, 20 September 2009 19:44
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(9-21-09) It is clear that equity markets grew tired late week, and we feel that the Friday equity action was held in green numbers only because option expiry was on the buy-side. We noted that the Dollar rallied on Friday. The SPZ premium came out of the contract after the market closed Friday. The only item which was not in place was the rally in the bonds. However Bonds should have declined Friday, as we warned in our Thursday night missive that the USZ contract would likely decline by one point or more in Friday’s action, with no fresh news and fresh Treasury supply coming next week. Watch Sunday night if the Bonds start to rally Sunday night -- and we feel they will -- along with a continued rally in the Dollar that will set up a potentially Blue Monday for equity prices. Also in our Thursday night missive we had recommended shorting the Copper at 290 or better. In Wednesday’s trade, we had recommended shorting the Pound above 165. You see that the Pound came all the way down to test the 162.70 area late Friday. We think that the Pound has more to go on the downside. Shorting the Pound last week was like literally having a license to print money.
We are continuing to sell the Grains on rallies. We have shorted the Nov. Bean contract, which we traded 23 times on the short side last week and would now reduce our shorts target from 960 to 955, which we did late week.
Do not be concerned about the continued rallies in the OJX contract. We see the last of the shorts now being squeezed out of the Juice, and we think the Juice is now a sell in the 103 area.
We also feel that many of the deeper shorts in the LBX contract were weeded out in Friday’s trade. We think that contract is also now a short. Furthermore we had been looking to sell the December Cotton at 6450 or better, levels that were achieved Friday in the close. We think the shorts are now out of the Cotton contract. Further the Cotton Shill which was similar to the Indian Sugar Shill, based on Indian crop damage, is effectively nonsense as the Indian Government itself states.
The December Cocoa contract, which we traded Thursday during the decline, took a total of $200 out of the trade, snapped back late Thursday and in Friday’s session. However we would look to sell this contract at current levels. In short we think the equity markets will crack and bring the commodity markets down with them early week.
The December Gold contract, which has been trading technically perfect – we shorted all the way down from the old breakout point of 1022.80 high, taking a total of $17 out of the contract in short-scalping action in the last 3 days of the week. The contract, now resting at 1008 – if that cannot be held the contract will come down to retest the 997 area.
Active professional traders should email us [customercare (at) InsiderIntelligence.com] for our daily and nightly updates to join our trading update service…
As Always End of Week Market Action Creates Fresh Opportunities
Written by Al Martin Sunday, 13 September 2009 19:55
(9-13-09) We saw last week's series of US Treasury Bond auctions well-received. As a consequence, we saw the December Bond contract bid up Friday to trade above 121 before getting some vertigo. We have seen this phenomenon before when the Bonds have gotten vertigo above 121. The contract fell back to 120.14 on the close. However we believe that this contract will see 121 and higher in next week's trade.
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Late Week Market Action Creates Opportunities for Next Week's Trade
Written by Al Martin Monday, 07 September 2009 16:32
(9-6-09) In Friday's session we saw the Long Bond contracts fall a point-and-a-half, resuming the Friday pattern before fresh Treasury supply in the coming week. We had shorted the Bonds in Friday's trade at 119.16, at which time the Bond contract generated a daily sell signal.
The Sep. Dollar contract continues to be a buy-on-dip trade, continuing to trade in the 15 day range of 78.00 – 79.00. We continue to buy the Dollar on dips.
Read more: Late Week Market Action Creates Opportunities for Next Week's Trade
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