Long Bond Continues To Gain As Gold Sags
Written by Al Martin Sunday, 23 March 2014 22:26
(3-23-14) In line with our previous week’s predictions, the June Long Bond contract continued to move irregularly higher throughout the week. We continue to trade the Bonds on the long side, buying the Bonds twice in Thursday-Friday’s session on our standing buy orders at 131.30, taking a half of a point out each time. We continue to like the Bonds on the long side.
Expect Fear Bid to Continue in This Week's Trade
Written by Al Martin Sunday, 16 March 2014 23:00
(3-16-14) As the situation in Ukraine continues to deteriorate along with still more bad Chinese data expected throughout the week, we would expect the fear bid trade to continue. We will continue to trade the June Long Bonds from the long side on any pullbacks Sunday night.
Make Way for This Week’s Declines
Written by Al Martin Monday, 10 March 2014 23:20
(3-10-14) After better than expected Friday data, we would expect that with soft Chinese data over the weekend that there would be pullbacks in equities and commodities. We would also expect the Bonds to continue to move higher. We continue to trade the June Long Bond from the long side on dips. We are coming into the Sunday night session long the Bonds from 130.26. We are looking to sell up to a move at 131.16
We would also expect the April Oil contract to back off further. We are short the contract from 102.70, looking to cover on a retest of 101.70.
April Gold – we would also expect to fall back in the session.
Short the Gold from 1342. We are looking to cover on a test of 1320.
May Silver continues to underperform relative to the Gold. We continue to short the Silver on moves to 20.90 or higher, covering on 20-30 cent dips.
The May Sugar got hammered in late week trade as fresh Indian supplies began to pour into global cash markets. We continue to be short the Sugar from the 18.52 level. We have covered half of our position on our standing order at 18.02 and now looking to cover our remaining shorts on our standing order at 16.52.
After the false breakout in the May Juice above 1.50, our 1.5005 buy stops were hit midweek. We took 5 cents out of the contract. We shorted the juice at 1.56. We think the Juice is just being dragged up by the action in the rest of the trop complex.
We expect the Grains also to fall back in the coming week’s session. We are short the Beans, coming into our May Beans at 15.58. We would expect the Beans to fall back for a test of the 14.20 area.
We are also short the Wheat from 6.54. We are expecting a 20 cent pullback in the Wheat and a 20 cent pullback in the Corn.
We would also expect the Lumber which initially held 350 to come back for a test of the 350 area in the May contract.
The April Platinum contract is once again shortable above 1380. We came in short the session at 1483 with our standing cover order at 1463.
We were short the May Copper from our emergency sell recommendation Friday morning at 3.21. We took 30 cents out of the contract in Friday’s crack. We would expect after Chinese data over the weekend combined with what we feel will be weaker Chinese data Wednesday night that the Copper is coming down for a clean test of 3.00.
May Coffee – Vietnamese Coffee finally coming to market. We continue to short the Coffee on moves up to 1.9950 or higher as we did in Friday’s trade covering on 3-4 cent dips.
We also own and are holding on to our $2 strike Coffee puts as we expect in the next 30 days that the Coffee will break hard.
The May Cocoa contract also getting a run-up as a sympathetic catch-up play. We sold the contract at 2980 on the close Friday, looking to cover on a retest of the 2930 area.
We also sold the May Cotton in Friday’s turn-back. We have covered half our position on our standing order at 91.30. We are looking to cover the other half on a test of 90.00
Increased Geopolitical Strife Combined with Weaker Chinese Data To Create Upcoming Opportunities
Written by Al Martin Sunday, 02 March 2014 22:58
(3-2-14) We saw the June Long Bond continue to move higher in late Friday trade, as fear bid money came in, based on increased political tensions in Ukraine. This combined with poor Chinese manufacturing data released over the weekend makes it likely that the Bonds will continue to climb in Monday’s session. We think the weakness in the Dollar we saw Friday will be reversed in Monday’s session, as we believe the fear bid will also come in to the Dollar. Once again we were shorting the Euros above 137, covering on 30-40 bps dips. We think the Euros will move lower in Monday’s session.
Professional Short Interest in Spoos Builds to Record Levels, as Interest in US Treasuries Continues to Increase
Written by Al Martin Sunday, 23 February 2014 22:11
(2-23-14) Once again we were filled on our standing short orders in the March Spoos at 1840. We have been consistently selling the Spoos in the last 10 sessions in the 1840-42 range, covering on 10-20 handle dips. We have noticed there are nothing but sellers in the Spoos above 1840 and we think the Spoos should be shorted there for rides down to retest the 1820 area.
Interest in the March Long Bond contract also picks up, with
long interest now exceeding short interest for the first time in 12 months. We
continue to buy the March Bonds on dips down to the 132.16 area, selling on
lifts back to 133.08. That trade has proved consistently good, as demand for
long-dated US Treasuries continues to build.
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