Market Recap 1-25-08 Rouge Trader Excites Markets All Over World

     This rouge trader from the Société Générale named Jérôme Kerviel was the market mover for the week. As the US markets were closed on Monday the futures brokers all over the world were in a major panic. Wednesday morning we all find out that one man once again can collapse a market with one fell swoop of fraudulent trading. The US Federal Reserve states that they did not know anything about the rouge trader before the Tuesday morning interest rate cut. Is it hard to believe that with all the political economics all over the world that the US did not know when the Société Générale knew and was trying to get out the positions with out moving markets. Or was the US just covering for the Société Générale. All right that is enough on the political thinking. Let’s see how the markets reacted to this drop on Monday and Tuesday. Well the DOW did a 600 point turn around, Gold went from $855.00 all the way back over $900.00 & the USD went from the .7700 mark all the way back down to under 7600. It would be pretty amazing if all futures brokers had there clients in on the right side of those moves. This next week will be the one to watch to see if the US Federal Reserve cuts rates another 50 basis points on Wednesday.

     The meat spreads from my previous blog. If you were in you should be looking to liquidate positions going into February. Even though we were looking for a slower world economy the food and energy sides should stay strong for another few years. February break for the grains do not look like they will last long enough to really work this year. My end of the month outlook will explain more into the grains and meats than this week.

     Sugar, is it still on its way to .1400. If you look at the mid summer to late year movements of sugar there is very little. Speculators are all over the sugar now with volatility going from a .0020 swing to .0070. That is a 300% increase in volatility. Looks like we may be forming a solid trend going into the end of January but only if it can hold a few days of solid gains. How the markets move and change make outlooks on the markets a bunch of nonsense if you don’t change with them. Remember,Past performance is not indicative of future results. Trading futures and options is not suitable for everyone. There is a substantial risk of loss in trading commodity futures, options and off exchange forex.

Market Recap 1-18-08

Where do we start this week? Well, let’s take the “Sleeping Giant” SUGAR, after my post for the mid week on wednesday sugar took off all the way past the .1200 to .1303 it settled at .1245 and then all the way back down to .1117 today. Going into the close of the pit it is trading in the mid eleven cent range. Is it still a good buy here? with the world economy going through a slight turbulence the supply and demand for all commodities may change. I still believe that sugar may reach the 50% retracement at .1359 but we would have to sustain here at .1150 area.
Now for the talk all over the world. S&P 500. What a wild ride for a Tuesday. All futures brokers were in for it this morning. The only ones with smiles on there faces were the ones if they were short. Let’s face it, a 75 basis point cut in the interest rates and the president coming out with a 145 billion dollar stimulus plan still cannot sustain a large move to the upside. Granted were are trading in 1311 area this afternoon but it won’t take much to take out the lows again. Can we all say “Global Panic”. Once one touches the down side then they all come aboard. The big guys are looking for Federal Reserve and governmental bail out still. It should be an interesting week for the S&P 500. Check out my previous post for where it should go using Fibonacci Retracements and support and resistence techniques.
For the grains “Beans in the Teens” was short lived for now still trading at $12.50 level but this world panic epidemic might drive prices down. Corn at $5.00 was short lived also trading just below the $5.00 mark at $4.97 but seems to be the strongest of the grains right now. Let,s see how the grains pan out for the next couple days and I will have an overall look at those markets.
Gold, Gold, Gold. Went back a nd touched that $850.00 level in the overnight now back up to $900.00. Let’s see how the fund managers handle this episode with the S&P 500. Are they going to flee and drive up gold one more time? If we hold this $895.00 level and get a close above $900.00 by the end of the week we may see a run to $950.00 again. As stated in the earlier posts.
Hope everybody had a good three day week-end and look for a mid week recap again. Remember,past performance is not indicative of future results. Trading futures and options is not suitable for everyone. There is a substantial risk of loss in trading futures and options.

Mid-Week Market Recap “The Sleeping Giant”

Normally don’t blog for a mid-week recap but with all the markets moving “limit up” and “limit down” all in the same week is just amazing. Futures brokers all over, probably are grabbing onto their hats for a wild grain train ride. Just to recap my previous post, we saw corn “limit up” on Monday, which took it to that $5.00 level. Then the past two days we saw it test $5.00 yesterday and break through this morning touch $4.96 and now back above. Tomorrow will be the key day to either confirm a reversal or it just a break with a good buying tail. ” Beans In The Teens” saw it on Monday, then on Tuesday with a close in the teens. Wednesday we open up and “limit down” now bouncing around that $12.75 level in the afternoon. In order for the reversal in beans there are a few key factors, 1.) Rain, Rain, Rain in South America, 2.) Hedge funds to stop buying and then lastly any close below the $12.50 would pretty much confirm a top has been posted.. If you follow the Elliot wave method you are looking at wave #4 to wave getting ready to start. 25% Fibonacci Retracement will bring us back to $12.18 which there is also a gap on the chart right there also. Most of the time the markets will come back and fill the gaps, but might want to wait till the top is confirmed and it rains in South America.
  Gold futures brokers are having a fun time with these hedge funds, looks like the fund managers either went over margin and the exchange is going to raise again or they just figure they can take profits here. My theory on this is a little of both, to many fund managers trying to make sure they make enough to cover their losses in the markets last week. After two days of gold hitting the $915-$916 area with no good bullish news coming out they figured taking profits are a good thing these days. If we can not hold the $890.00 level we might be looking at a 50% retracement to $850.00 before looking $900.00 again. The big guys came out and said that gold will average the $915.00/ounce this year. If that holds true and the volatility is the same as 2007 we may look at a range from $800 to $1,000.00.
  S&P 500 may be looking for that 3 yr bear trend to a 62% retracement to 1110. It will have a few key stops on the way, first stop if we close below 1370 on a monthly chart will be 1276. Not much consolidation on that way down, but once we hit there we will be on slow boat down to the 50% level at 1192. If we cannot get enough support at that level we will be looking at the 62% retracement at 1110. If history repeats itself we had a 10yr bull market to 2000 and then a three year bear market to 2003. Now we are just finishing a very good five year run to 2008, now another three year bear, if not less. May only reach that 38% or 50% retracement before the turn around. All this is just nonsense if we don’t break that first stop at 1370.
  My following for the week will be the sleeping giant. ” SUGAR ” All other markets for the year of 2007 have been quite noisy in there movements. The last month of 2007 was just the awakening of sugar. This is where we will probably see sugar running to new levels do to the up and coming Brazilian Real. Also, it being tied into the ethanol. Crude reached new highs and sugar was quiet, crude holding or maybe even slipping a little and sugar will be free to run to that 50% retracement level of 1359. Futures brokers and futures speculators are going to have fun this up coming year. This is the end of the Mid – Week Recap but remember,Past performance is not indicative of future results. Trading futures and options is not suitable for everyone. There is a substantial risk of loss in trading futures, FOREX and options.

Futures Trading Market Overview “Corn, Soybeans & Gold”

     Futures brokers and futures speculators may be in for a wild ride this new year if this week is any indication of the year. Friday was a wild ride in the grains, we had corn “limit up” from open at the CBOT and soybeans were touching with limits shortly after. Wheat had the most bearish news of them all in the USDA Grain Report on Friday, it was a “limit up” for most of the late day trading. Corn was the most solid never moving off limit all day. It finished the day at $4.95 a bushel coming real close to that $5.00 mark. If corn does another “limit up” move on Monday it looks like we may even see a much larger increase going into the spring, until the final acreage as been assumed. If not will probably consolidate somewhere in the $4.75 to $5.10 range until South America comes in to secure numbers. Soybeans and soybean complexes are all in a strong Bull Market. “Beans In The Teens” from my previous post was there for a short time on Friday will have to see if the follow through comes on Monday. The soybean oil sure is being pushed not only by the soybeans itself but with crude still trading above $90.00 keeps it strong. Soybean meal is looking like it may want to start taking the lead again in that complex.

     Now for Gold Futures Brokers and Gold speculators with all the “Credit Crunch” still going on, and the investors still fleeing that stock market we may see $950.00/ounce by bulls end. Spot gold at a high of $895.80 and front month futures (February) at an alarming $900.10, if we get a close above the magical number $900.00 it will be the train to $950.00. Most personal investors are still seeking gold for their portfolios. Futures brokers should be answering phones like mad in the upcoming months as personal investors seek other avenues, other than holding the actual gold itself. If no close above $900.00 and the indexes start to rebound of their 2008 yearly lows we may see it testing that $850.00-$800.00/ounce mark again in the near future. Like anything else, “what goes up must come down” in order to go back up again.

      The markets to be watching this “February Break” will more than likely be the meats. Another words the “seasonal trading” of Cattle and Hogs. Out of the past years it has been sell cattle and buy the hogs. This year may hold true again but with the over supply of front month hogs you might want to look at April or June. That is the end of my weekly recap, and remember

Past performance is not indicative of future results. Trading futures and options is not suitable for everyone. There is a substantial risk of loss in trading futures and options

Record Highs!! Record Lows!! 2008

Is this going to be the year of records? We have already seen crude and gold hitting records, the British pound is on its way for lows and the US dollar is bouncing off of its record lows from 2007. The grain market is searching for “Beans in the Teens” and corn on the way to $5.00. Is the February break the end of the soybean complex massive bull run. If your money is not geting the returns in the stock markets, the futures and commodities maybe the place for a good return in 2008. Banks are hiring futures brokers at an alarming rate, due to the increase in the commodity prices.  Just remember,  Trading futures and options is not suitable for everyone. There is a substantial risk of loss in trading futures and options.