I think this whole 150 day collapse has about run its course... Lets take a look... GSCI is now around 366 - We might make a move down to 330 area which corresponds with the upper trendline boundaries of the 2000 peak, the 2003 peak, and the 2005 retest...so maybe the energies have a little bit left to fall, but the risk is now for prices to rebound.... If we get one more dump in the crude down to the low 40's, I will be a buyer. I am long NG in the back months. And looking at RBOB/HO into next summer. S&P broke the 2003 lows making for a very ugly chart. While I think in the long run, we could get continuation down to the mid 300 level, we might have capitulated today, in conjunction with the wild spike in bond prices (and corresponding yield crash). 10 year yields around 3% will not last for longer than a moment, so look for a reversal there...(admission - I have been short bonds for the last 6 weeks or so, so I am underwater there and perhaps a bit clouded in my bias)...I have 2.95% in the 10 year as the absolute low... Grains I'm a bit murky on because harvest is slow and there has been no post harvest rally yet, so I'm mainly sidelined there, but looking at good value in cotton and oats. Rice still has a move down to the 10 handle and perhaps another buck in C, W and another 2 bucks lower in beans...But for the most part, the risk is now to the upside...Am short wheat, was looking for 440, but may take profits here. Gold has held up very well considering...you don't have deflation when gold is trading $750 / oz, I'm sorry...Silver has taken the biggest beating of all, so I would still think you gotta buy the stronger of the 2... The Dollar might make one last spike up to the 96 area...but I can't see any higher than that... PS - I'm not a kinfe catcher, but that's what my assumption assumes you must do. I don't see a V bottom, but a retracement, and then consolidation. Eventually (next 2-3 years), prices in most all ag/energy/PM commodity markets will make new all time highs.
Unfortunately, I agree and I think were are in for it: BIG TIME. Next target on the SP500 is 4000. As for gold, don't forget that it is also viewed as a safe-haven, so that's why silver has tanked and not gold.
Nice post but I'm staying short until I see frozen conc. orange juice break through a bollinger band, or at least show increased volume for the coming holdays. One caveat is a rumor that Oprah will feature a cranberry sauce using FCOJ as an ingredient. I'm not buyibg until I actually see the show. I got killed on pork bellys last month when a rumor about Wendys ditching the Baconator hit the street.
No way, it darn well ain't over yet. Since you are such a trading guru I let it to yourself to figure out why. Maria
Help me understand this: S&P going down in the long run means that you should be rather betting on the 10 year yields heading down as well. Don't you see a condradiction here?
I can't grasp the rational of the argument that the equity route is over as the economic fundamentals continue to deteriorate around the globe: U.S. manufacturing is at an 18 year low and declining, the unemployment rate is at a 16 year high and rising, and those receiving unemployment benefits are at a 28 year high (and likely to rise). I could understand a 'bottom call' if the economy wasn't rapidly deteriorating, not just here, but abroad - at least stabilization would remove the risk of earnings' deceleration and disintegration - but the fundamentals, which control the destiny of future earning, are getting worse; they're not getting better or even stabilizing.
Isn't the fact that the market is down 50% from it's high would also mean that the corporate earnings are expected by the market to be cut in half? Do you expect the deterioration of the earnings to get even worse?
You might want to look at historical values of gold. There have many episodes where gold was *higher* than today during deflationary episodes that lasted years at a time.