MBWealth's Commodity Blog » livestock

Protected: The Line in the Sand February 06, 2012

Matthew Bradbard — Mon, 06 Feb 2012 22:08:39 +0000

Protected: The Line in the Sand January 30, 2012

Matthew Bradbard — Sun, 29 Jan 2012 17:30:41 +0000

Protected: The Line in the Sand January 23, 2012

Matthew Bradbard — Sun, 22 Jan 2012 17:38:46 +0000

Back to Work 1/17/12

Matthew Bradbard — Tue, 17 Jan 2012 20:41:25 +0000

After a long weekend the markets are back to normal trading hours. Crude will finish just shy of 2% higher but will not retake the 9 day MA; in March at $101.25. I have advised the sidelines thinking we remain in the $10 range and do no wish to establish a position being we started the day near the middle of the range. Multi-year lows in natural gas with prices down near 7% today. This makes it five losing sessions in a row with no bottom in site. Equities inch higher as the 9 day MA continues to support. Use that level as your pivot point; in the March Dow at 12370 and the S&P at 1282. Gold traded above the 40 day MA again today closing just under that mark. I’m expecting a further leg higher and this would be accelerated if the dollar was to back off. I see support at $1635 in February as our upside target remains $1680…trade accordingly. Support is seen in silver just above $29 in March with an upside target of $32. The big mover today was copper breaking resistance and advancing to four month highs. This was likely from the continued growth out of China. Q4 GDP coming in just under 9% is certainly nothing to sneeze at. The dollar is exhibiting signs of fatigue but I would like to see a settlement below the 20 day MA before getting too committed . That level is 80.90 in the March contract…trade accordingly. Aggressive traders could buy the Euro or short the Yen with tight stops. Both trades are a slight forces so I would hold off for confirmation. Cotton closed above the 100 day MA for the first time in seven months…take off all bearish trades at a loss. For nine sessions Euro-dollars have picked up steam. There will be a time to get short but until we see signs of an interim top let the market work higher. I am still looking for signs of a bottom before reestablishing longs for clients in any of the Ag markets. I believe we have a shot of seeing the December lows challenged so be patient. Livestock traders could be back long April live cattle and lean hogs with stops just under the 20 day MA. I like the prospect of higher hog prices and the technicals appear a little less risky in my opinion.

Risk disclosure: The risk of loss in trading commodity futures and options can be substantial. Past performance is no guarantee of future trading results.

Protected: The Line in the Sand January 16, 2012

Matthew Bradbard — Sun, 15 Jan 2012 22:13:55 +0000

The Line in the Sand January 09, 2012

Matthew Bradbard — Sun, 08 Jan 2012 16:04:41 +0000

Please click on the spreadsheet to view, zoom to 100% if needed. The Line in the Sand format has changed, you will be receiving the chart on technical analysis Monday mornings. Please visit Matthew’s Daily Thought for your market wrap ups and predictions. In addition he will be posting a new article per week, you can find those in Published Articles. If you subscribe to our Feed, you will be notified when new posts are available. If you ever have any questions about The Line in the Sand or any other post, you may contact us for any reason.

Traders Market 1/5/12

Matthew Bradbard — Thu, 05 Jan 2012 21:35:33 +0000

The impressive start to the year in both stocks and commodities is coming into question as some big movers start to retrace. The message is clear 2012 like previous years will likely be a traders market NOT buy and hold. Crude failed at its highs and by day’s end reversed to trade down nearly 2%. I’ve suggested clients to take off their positions and move to the sidelines. It would take a settlement back under $100 for me to gain bearish exposure again for aggressive clients. Natural gas erased al of yesterday’s gains taking prices back near their lows. Just when I thought longs were out of the woods…very frustrating. On a new low expect follow through so do not get a large position on if you are willing to weather this. Stocks found support at the 9 day MA closing near the upper end of their trading range. We are still expecting a further grind higher but tomorrow’s action should be influenced by the jobs number in my opinion. Gold continues to climb higher as I feel we’ve seen about half of the current leg play out, February target $1680. Same comments on silver as yesterday the market appears to be taking a breath before the leg higher resumes, March target $32. The 20 day MA supported the dollar today as prices raced 1% higher lifting prices near contract highs. Though we expect a trade back to 79.00 in March on a new high we would cancel that idea thinking momentum could lift prices near 83.00. Stay alert because an upside dollar breakout would likely lead to lower trade on other crosses. We’re getting mixed signals and suggest being nimble trading both sides and implementing tight stops because there is no clear trend in forex currently with the exception of the Euro and Swiss which should continue down. In full disclosure I recently voiced a bullish trade to no avail. Sell signals in coffee and sugar today…aggressive traders could gain bearish exposure. Continue to use the 20 day MA in Treasuries as your pivot point. Hopefully grain traders booked profits on their longs as price action appears to be reversing. Corn lost 2.28% today with wheat down 3.2% and soybeans off 1.7%. We anticipate further downside in the immediate future…trade accordingly. Continue to fade rallies in live cattle targeting a trade under 119.00 in February. Take longs off in lean hogs… most traders should be at break even or a slight profit depending on their entry.

Risk disclosure: The risk of loss in trading commodity futures and options can be substantial. Past performance is no guarantee of future trading results.

1/3/12 Giddy Up

Matthew Bradbard — Tue, 03 Jan 2012 21:47:58 +0000

Investors, traders alike wasted no time putting money to work as most stocks and commodities started the new year on a bang. We do not expect this pace to continue but perhaps the public is waking up to the fact that cash and debt will likely underperform select stocks and commodities in the foreseeable future. Crude starts the year with a bang advancing better than 4% today to lift prices to two month highs and on the verge of an upside breakout. If February takes out $104 expect prices to find their way to $110…trade accordingly. Traders who have been selling above $100 should take a loss on a trade above $104 in my opinion. RBOB and heating oil also appear poised to trade higher. We’ve advised hedgers to institute more upside protection. Natural gas was flat today but remain the dog in the energy complex and one of the weakest links in the entire commodity sector with prices sliding nearly 45% in the last 6 months. Without a settlement above $3 in the coming sessions the momentum will remain bearish. Some clients have used setbacks to buy 2-3 month long contracts but this has been a losing proposition to date. Equities leap to a six month high today on decent volumes. Forget about trading the indices but those with large security portfolios should use a further appreciation to take money off the table…in my opinion. The metals likely reached an interim bottom last week as gold has bounced nearly $90 and silver jumped$3.50/ounce. We would work back into longs buying dips thinking $1525 and $26.25 respectively would serve as solid support. Our first targets would be $1675 in February gold and $33 in March silver. The dollar closed back under the 20 day MA for the first time since mid-November. We see further downside which should equate to gains in other crosses. My picks would be the Euro and Pound but with circumstances less than rosy in Europe run tight stops. All softs were bid higher with sugar and cotton being the standout gaining 5% and 4% respectively. Not to be outdone OJ with a potential freeze in Florida gained 2.65%. Aggressive traders can buy sugar with an upside target of 27 cents in March. Treasuries remain range bound though on a breach of the 20 day MA’s we would have bearish plays on our radar. In 30-yr bonds that level is 143’8 and in 10-yr notes 130’13. In three short weeks grains have moved from oversold to overbought lifting prices of corn, soybeans and wheat to two month highs. With today’s gains both corn and soybeans hit their 38.2% Fibonacci retracement levels while wheat has a few pennies to go. The easy money has been made on longs so I suggest tightening stops and starting to look for an exit door. Bad weather in SA has been factored in so we will need to see further developments to see much higher ground in my opinion. Live cattle lost ground for the fifth straight session closing below the 9 day MA again today. We see further depreciation and have a target of 119.50 in February…trade accordingly. Traders can be long February lean hogs with a stop below 83.75. A close above the 20 day MA at 85.75 should signal a new high.

Risk disclosure: The risk of loss in trading commodity futures and options can be substantial. Past performance is no guarantee of future trading results.

The Line in the Sand January 02, 2012

Matthew Bradbard — Tue, 03 Jan 2012 03:03:55 +0000

The Line in the Sand December 19, 2011

Matthew Bradbard — Sun, 18 Dec 2011 07:02:52 +0000