Another Monday

Another Monday

by Turd Ferguson
I’d say that’s a pretty good start to the week. Again, considering where we were at 9:30 on Friday…

Let’s start with gold which, personally, I’m getting a little sick of. As I showed you over the weekend, gold has been in a range now for over six months. Yuck. It’s wearing me out. It had some promise overnight but the lack of follow-through in WTI put a damper on things. As we all know, the price of gold as insurance against collapsing fiat should have nothing to do with the price of WTI but try telling that to some of the Commodore 64s that are currently in charge of the trade. This, too, shall pass…perhaps very soon. But for now, the range continues:

Now, one more thing regarding WTI. Brent crude is currently over $120/bbl, which is a gain of about $1.50. If Brent hangs in there and then moves higher, crude will eventually jump to catch up, regardless of how much oil is stored in Oklahoma. WTI at $110+ will make The Cartel’s task of containing gold below $1440 considerably more difficult.

Silver is just beautiful. In the past, you’ve heard me mention how the nasty shorts will place “buy stops” just above previous highs. The dipshits figure that if silver breaks out to new highs, they want to cover their shorts and look to re-establish at a higher level. You can clearly see this on the chart below:

To me, silver looks to have spent the day consolidating at this higher level. In the past…and you know how much I like patterns…a breakout to a new high consolidates like this and then springs higher as greedy longs, who have taken a wait-and-see approach to the breakout, come charging in for fear of missing the next big UPleg. If pattern repeats here, we’ll soon see some acceleration to the UPside, maybe some hesitation at 39 and then a thrust toward $40.

Lastly, my corn is just doing great. Check out this daily chart:

Now that we are back in the primary trend from last fall, you can expect this baby to keep chugging higher. Remember, the USDA report that showed planting intentions last week will be the high number of acreage for the year. Weather delays will undoubtedly force the number to be adjusted lower over time and this will be just another factor driving corn higher. Many have asked how an equity/etf trader can profit from commodities. You might check out the DAG. Its an ETN that is composed of 25% corn, 25% wheat, 25% soyas and 25% sugar. A warning, though, trading grains is NOT for the faint of heart. Expect volatility but always remember that “the trend is your friend” and, in this case, the trend is clearly on our side in all dollar-denominated commodities.
http://finance.yahoo.com/q?s=DAG

OK, that’s it for now. More later…before the big basketball game. TF

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This entry was posted in Gold, Silver, Technical Analysis, Turd Ferguson. Bookmark the permalink.

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