Driving Force 8/26/9
Us dollar held most of its gains trading back over the 20 day moving average which as we’ve previously stated will remain the pivot point. Our featured play is continued strength in the dollar with int’l currencies faltering. We bought September 81 cent puts in the Aussie for clients today, paying $300 looking to exit be weeks end for $500. With only 9 days til’ expiration win, lose or draw by the weekend. Crude oil and the distillates were lower but low and behold Natty caught a bid at days end and edged higher. We like being long November. Read our post from today about the Crude:Natural gas ratio. This week this ratio traded to historical extremes and we do not expect it to last. Gold and silver were quiet stuck in a narrow range for most of the day. Surprisingly they did hold considering outside market weakness and a strengthening dollar. Corn did little today but wheat did manage another positive showing , with December gaining 8 cents. We should be able to see enough of a rally to show a slight profit or small loss on the December calls clients own. Cocoa lost almost 2 % and sugar a gainer of just over 2%. Both in our clients favor. Cocoa may be too little too late but on a sharp break we may fight back from the grave, expiration in 2 weeks in the October contract. We will be pricing out long coffee plays in the coming sessions for clients. 27 out of the last 34 years buying coffee August 18th and holding for 13 trading days until about September 4th has been a profitable trade. Past performance is not indicative of futures results. Buy Euro-dollar puts and sit on your hands. We were unable to take a profit on clients long lean hogs. We now may need to wait being prices were hit today losing 2/3.5%. The spread in live cattle is working perfectly for clients, we continue to expect December to gain on October as August goes off the board next week. See previous posts.
Risk Disclosure: The risk of loss in trading commodity futures and options can be substantial. Past performance is no guarantee of future trading results.
Tags: cocoa, coffee, commodity, corn, crude oil, euro-dollar, futures, gold, lean hogs, live cattle, natural gas, options, silver, sugar, wheat
