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American Investors Safe from Nickel’s Boom and Bust

Andy WaldockComment on American Investors Safe from Nickel’s Boom and Bust

There’s good news on the horizon for the average U.S. retail investor. There’s a bubble coming and for once, Joe Investor is going to miss out on the boom and crash. Two primary stories create the potential for a short-term meteoric rise in prices only to quickly plunge as macro economic forces and political issues sort themselves out. In a world full of financial instruments, global exchanges and products ranging from weather derivatives to technology indexes to silkworm futures, the base metal nickel is inaccessible to the average retail American trader.
Ten years …

Current Markets Macro Viewpoints

Commercial Short Selling in the Crude Oil Market

Andy WaldockComment on Commercial Short Selling in the Crude Oil Market

The United States is awash in domestically produced crude oil. U.S. crude oil inventories just hit a 26-year high. Heck, just last year North Dakota passed Ecuador’s production and Ecuador is a member of OPEC. Furthermore, the U.S. is expected to takeover the crown as largest global oil producer from Saudi Arabia as early as 2020. The questions that keep coming up are two-fold. “Why hasn’t the price of oil fallen and why are gas prices still so high.” The answer is simply, politics and logistics.
Forty years ago, the Energy Policy and …

Current Markets Gold and Silver Macro Economics

Gold and Bonds Getting Back to Normal

Andy WaldockComment on Gold and Bonds Getting Back to Normal

Gold, interest rates and the stock market have a very interesting relationship. Normally, declining interest rates are good for business and bad for gold. Post 9/11 and housing bubble, zero interest rate policies (ZIRP) created an artificial situation that fractured this relationship rendering it virtually useless over the last decade. This began to change last summer when the Federal Reserve Board stated that they would begin slowing the stimulus they’ve provided to the economy thus allowing interest rates …

COT Signals Current Markets Trading Strategies

Commercial Traders Own the Stock Market’s Gyrations

Andy WaldockComment on Commercial Traders Own the Stock Market’s Gyrations

The stock market doesn’t seem to know whether good news is good or bad news is good. The equity markets have sold off between 4 and 6 percent since we published this key reversal in early March with the small cap Russell 2000 and Nasdaq 100 tech stocks peaking a month before the big Dow and S&P stocks rolled over. April’s unemployment report supplied the catalyst for the Dow and S&P sell off but again the question becomes, “is bad news still good…

Current Markets Macro Viewpoints

Cocoa Prices Set to Surge

Andy WaldockComment on Cocoa Prices Set to Surge

It’s been more than a year since we’ve discussed the cocoa futures market in any depth. Last February we discussing the seismic changes in the Ivory Coast’s political landscape and the paradigm shift in farming practices this would facilitate. African politics being what they are, it should come as no surprise that two years later there’s been less hope and change than was originally sold to the country’s people. The result may cost First World cocoa consumers a …

Macro Viewpoints

Bitcoin is Here to Stay

Andy WaldockComment on Bitcoin is Here to Stay

The next phase in the Bitcoin revolution will be the standardization of the exchanges where the coins are traded. Bitcoin is currently in the Wild West prospector days of its evolution. The world has agreed that a Bitcoin provides a stored measure of value in the same way that gold and silver have throughout the ages. Like gold and silver, Bitcoin is only worth what the other person is willing to pay you for it. This has led to cheating since trading began. Crooked scales and filled ore all became part of the norm as both the miners …

Current Markets Macro Economics Trading Strategies

Historical Wheat vs Corn Spread Prices

Andy WaldockComment on Historical Wheat vs Corn Spread Prices

Trading the grain markets has always been tricky, especially during the planting and harvesting periods. Historically, this has placed us at the agricultural epicenter for global grain trade. Obviously, tension in Ukraine and the corresponding 15% spike in wheat prices have reminded everyone that even the agricultural markets are now a global game.
In this respect, it’s no longer enough to keep an eye on domestic weather patterns to determine the success of our winter crops or anticipate spring …

Currencies Current Markets Macro Viewpoints

Global Uncertainty Strengthens Dollar

Andy WaldockComment on Global Uncertainty Strengthens Dollar

Five years ago the financial world was coming to an end. The stock market tanked and interest rates went negative due to the unsurpassed flight to safety in U.S. Treasuries. Most of this was due to greedy lending practices that claimed to be championing President Clinton’s thesis that everyone in America should be able to own a home. Lax lending requirements that were intended to get lower income earners into their own homes traveled up market and allowed upper middle and upper tier earners to refinance…

Current Markets Macro Viewpoints Trading Strategies

Trading Ukraine Uncertainty

Andy WaldockComment on Trading Ukraine Uncertainty

Removing the politics of the Russia-Ukraine issue and focusing on the economic implications of Russia’s bloodless annexation of the Crimean peninsula puts some trading opportunities on the table as global risk premiums jump. In order to do this, a couple of suppositions must be declared. First and most importantly, the United States will not actively engage Russian troops. In many ways, this is a replay of the Georgian conflict in 2008. Georgia was in revolt against Russia and wanted closer ties to the …

Current Markets Gold and Silver

Gold and Silver Topping Out

Andy WaldockComment on Gold and Silver Topping Out

The gold and silver markets have been perking up lately which happens to have coincided with the Fed’s talk of removing stimulus from the domestic economy. Logically, talk of higher interest rates has spurred interest in portfolio re-allocation towards gold and silver as investors attempt to get a jump on the beginning of a structural shift towards inflation. The result of this is that gold has rallied about 11.5% year to date and silver is up nearly 20%. Much of this rally has been technical in…