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Current Markets Trading Strategies

World Wide Wheat Shortage?

Andy WaldockComment on World Wide Wheat Shortage?

Russian drought news has been the dominant factor in the grain market this summer. Wheat prices began to rally in early June as commercial traders fully supported the lows around $4.50 while
accumulating a net long position of over 80,000 contracts. At this time, the Russian drought news began to hit the wires. The month of July was fueled by the daily weather reports across Europe as
this turned out to be the worst drought in 50 years. Wheat prices sky rocketed to $8.41 by August 6th and have since been in a trading range between $6.45 and …

Currencies Current Markets Macro Economics Trading Strategies

Buy Bonds – Price Appreciates What Yield Gives Up

Andy WaldockComment on Buy Bonds – Price Appreciates What Yield Gives Up

Buy Bonds – Price Appreciates What Yield Gives Up

Japan’s official interest rate policy hasn’t been above 2% since 1993. In fact, since 1996, it hasn’t been over .5% and has bounced
along at zero for much of that time. Furthermore, Japan has actively increased its balance sheet through the direct purchase of corporate debt as well as absorbing numerous bad loans. In spite of
this historically loose monetary policy, Japan’s major fight for over a decade has been deflation. Our own …

Current Markets Macro Economics

Commercial Traders Ahead of the Game

Andy WaldockComment on Commercial Traders Ahead of the Game

The Commodity Futures Trading Commission publishes a weekly report entitled, “Commitment of Traders.” This report totals the
positions by all major commodity market players and breaks them down into a few important categories. The category that is most predictive of future moves in the commodity markets is the
Commercial Trader category. This group is made up of people who are hedging their need for the physical commodity to meet future production as well as the producers of physical commodities who are
…

Current Markets Trading Strategies

A Counter Trend Thought on Gold

Andy WaldockComment on A Counter Trend Thought on Gold

The gold market has had quite a climb since bottoming in December of ’08, rallying nearly 50%. I think a solid case can be made
that this market is due for a correction. Furthermore, given the variables in play, the first leg of the correction could come hard and fast. As many of you know, I tend to place the general
direction of my trades in line with commercial traders. Over the course of time, this has been a proven strategy. However, there …

Current Markets Macro Economics Trading Strategies

Market Flux

Andy WaldockComment on Market Flux

Analyzing the markets requires a combination of quantitative and correlational research. It’s easy to track jobless numbers,
productivity, crop acreage or crude oil stocks.  These numbers help define the fundamental supply and demand of the price equation. Trading, actual trading, is different from quantitative
analysis because we are looking for actionable clues to imminent price movement and what will trigger it. These are the support and resistance numbers, spread ratios like gold to oil or, corn to
beans. These …

Current Markets Trading Strategies

Short Selling the Futures Market

Andy WaldockComment on Short Selling the Futures Market

Since the stock market’s dramatic sell off on May 6th, it has traded sideways to lower. The market has made new lows twice since then while each rally attempt has been capped by
resistance roughly half way back to the top. Technically speaking, this is called consolidation and consolidation usually means continuation. The idea of an object in motion remaining in motion goes
back as far as Isaac Newton and it still holds true to this day. This motion is what trends are made of and that is why consolidation is viewed as a pause in the existing …

Gold and Silver Macro Viewpoints Metals Trading Strategies

Don’t Pay Up for Precious Metals Diversification

Andy WaldockComment on Don’t Pay Up for Precious Metals Diversification

Gold and silver have exploded in recent years. The contributing factors of low interest rates, economic uncertainty, global
fear and pending inflation have done their share to boost precious metals’ outsized gains relative to the stock market. Gold has rallied more than 150% over the last five years while the broad
stock indexes are all flat to lower, depending on the day. Silver, for its part, has nearly doubled in the last five years. Given our still historic low interest rates and the …

Currencies Current Markets Macro Economics

Crude Oil and the World Market

Andy WaldockComment on Crude Oil and the World Market

Crude Oil and the World Market

 

May has been an interesting month in the crude oil futures market. The crude oil market has sold off more than 25% of its value in the
last month. It has gone from trading at over $90 per barrel down to $67 per barrel. The selloff has been based on two primary concerns; First, the continuing slowdown in Europe and secondly, the
growing strength of the U.S. Dollar. However, commercial …

Currencies Gold and Silver Trading Strategies

Uncovering Value in the Commodity Markets

Andy WaldockComment on Uncovering Value in the Commodity Markets

Uncovering Value in the Commodity Markets

The electronic meltdown in the stock market also cued a selloff in many commodity markets.
Typically, markets move in their own individual rhythms. However, when fear dispossesses logic and panic takes over, it becomes a case of sell first and ask questions later. As the stock market
selloff accelerated and we watched the media reports of the riots in Greece, survival became the primary concern. Now that the …