Kicking the Can

Kicking the can…is that another way to refer to death…well in the case of Europe and the US kicking the can down the road is similar to dying a slow death. Crude oil will close back over $100/barrel but well off its highs and considering outside markets I’m content remaining short. I am still expecting a trade under last week’s lows and prices to approach $90/barrel into December. Natural gas will close lower by 1.7% but we were able to hold onto the 9 day MA. Continue to scale into long s in February and March looking to ride prices back to $4 in the coming weeks. Add to the position when initial positions are 15-20 cents in the green and start trailing stops.
WOW…stocks are higher with authority on the news out of Europe and positive numbers here domestically. We blew through my 1210 and 11700 resistance numbers like a hot knife through butter. We likely will see follow through but our clients are not buying and prefer to be a seller from higher levels. We were wrong to be neutral to bearish in metals as we have shifted back to the bull camp with the price action today. Gold is back above its 100 day MA and should make its way to $1790 in the near future. Silver is closing in on resistance and on a penetration of $33/ounce we would likely see $35 soon thereafter…trade accordingly. FYI futures traders should be trading February gold and March silver now not December. Day three of the dollar decline with a trade below the 20 day MA for the first time in three weeks. We still are targeting 77.00 in the December contract. All crosses with the exception of the Yen can be bought on dips..we favor the Pound and Loonie.
Do not build a large position but get some skin in the game buying cocoa looking to add once the market proves an interim bottom is in. Support held in coffee as prices were higher by 4% today. We will be re-establishing bearish trades for clients in the coming sessions. March could see $2.50…that is the 100 day MA and likely a cap on any additional upside…trade accordingly. Both 30-yr bonds and 10-yr notes are back under their 20 day MA’s…use that level as your pivot point as we got sell signals today. Big upswing in Euro-dollars today…those trailing stops should have been stopped out at a profit. From here look to re-establish shorts after a further appreciation…stay tuned.
Ags were higher as we still are anticipating a 4-6% appreciation in this complex. Aggressive traders can get long though I would prefer to be a seller after the appreciation if that is how it plays out. We’re getting mixed signals in cattle but forced into the market we would certainly be long not short. Aggressive traders can gain bullish exposure in February though we would sell calls or buy puts against long futures as a hedge. A small bearish position in lean hogs makes sense to me adding once we get a settlement below the 20 day MA; in February at 91.10.
Risk disclosure: The risk of loss in trading commodity futures and options can be substantial. Past performance is no guarantee of future trading results.

Comments are closed.