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September 2016 Editors Comments

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Physical Commodities

A really mixed bag.  Grains and the soy complex still falling, energies
still plunging.  Metals strong, softs and meats mixed.

At the end of July, grains and soybeans were trying to stabilize.  The
same with energies.  Precious metals and even copper rallied.  Meats
still struggled.

The CRB Index (stockcharts.com, click on Free Charts,
then type $CRB the appropriate box) fell
persistently during the last half of July until the last day.  Having
returned from above the higher 50-day moving average (dma) to the
lower 200 dma, Index bounced sharply in an outside day.  On
the weekly chart, it had returned to the 50-week moving average
and left a tail.

On the first day of August (as this is being written), corn and soybeans
plunged again, as did crude oil.  Softs were mixed agaim but cattle
closed almost limit up.  The daily RSI and MACD are both at or near
readings
considered oversold.  Weekly indicators are neutral.

Now what?  Soybeans typically rally modestly from early August.  Gold
normally makes a seasonal low.  The energy complex tends to rally
during at least the latter half of the month.  September is a shoulder
month for energies and harvest begins for sorn and soy...

... but perhaps we should be ready to ...



Trade 'em,



Jerry Toepke


 

August 2016 Editors Comments

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Physical Commodities


Consolidation!?!

The old CRB Index (go to stockcharts.com, click on Free Charts, enter $CRB in box labeled Create a Sharp Chart) appears to be doing so on both daily and weekly charts.  After a multi-year decline, it hit a low on 1/20/16 of 154.85 and bounced.  It resumed its downward path but found support at 154.89 - and bounced.  But this time the bounce continued higher.

In fact, by 6/8/16, it had run up to 195.88 "an" increase of 26% - when the whole world appeared to be bearish!  It pulled back to 187.01 on 6/27/16, but has been testing resistance at 195-200.  Price is above the50-day moving average at 187.30 and the 200-day MA at 179.66.  It has now spent five weeks above the 50-week moving average at 182.93.

Crude oil broke hard.  Midwest Corn and Soybean Belts both received timely rains.  Wheat fell to multi-year lows.

But softs continue to be perky.  Precious metals have outperformed expectations.  It has been gold, yen, bonds - and the US dollar that investors pile into when stock markets look ,,, ummmmm ... risky.

How much money might be available if and when money begins really to flow out of global stock markets?

Perhaps we should be ready to ...

Trade 'em,

Jerry Toepke


 

July 2016 Editors Comments

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Physical Commodities


Wow!  Remember when the world was going to be suffocated by soybeans because US stocks were heavy, South America planted record or near-record acreage, and political change in Argentina was going to unlock two years worth of soybeans?  Remember when the world was going to be flooded in crude oil?

That was when the CRB Index (stockcharts.com, Free Charts, and type in $CRB) was trading below 155.  After hitting 154.85 and then 154.89 in early 2016, the Index blew through its 18-month downtrend line in April.  It now trades above 185 a 20% increase.  It is currently trading above its 50-day moving average (178.50) which is about to cross over its 200-day (180.01).  It has broken through and is trading above its 50-week moving average and is still
not overbought on daily or weekly indicators.

Gold and silver led the initial rally but crude oil and agricultural markets have since taken over the lead.  What?  Food and energy?  Who uses those?  No, wage inflation has not (yet) picked up, although moves to increase the minimum wage may generate pressure.

Inflationary and deflationary prssures historically appear in commodities first, so ...

... perhaps we should be ready to ...


Trade 'em,

Jerry Toepke


Last Updated on Thursday, 02 June 2016 13:03
 

June 2016 Editors Comments

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Physical Commodities


Has the US dollar formed a major top?  Or has it been consolidating in a range the lower boundary of which it briefly penetrated to form a washout bottom?

Is the stock market forming a multi-year peak?

Has the CRB Index made a multi-year bottom?

The answer to any one of those questions, let alone any combination of them, will have profound economic, social, and political effects on the future.  Your editor has barely enough wisdom to know that he doesn't know even though he has his suspicions.

After a powerful multi-month rally from about 80.00, the US Dollar Index futures spent the next 15 months in a range between 100.79 and 92.52.  Much of the fundamental discussion centered around the difference between low but ready-to-rise US rates versus even lower in some cases, negative! rates in other major economies.  Further, the US economy was seen as growing slowly but at least growing.  But the dollar's March close was lower than any monthly close since December 2014.  And the April was even lower.  In the first two days of May, it slipped below that hump (92.52) of a potential double top only to reverse on that second day.  Washout?  Or just an overdue bounce from grossly oversold?

Perhaps we should be ready to ...

Trade 'em,

Jerry Toepke


Last Updated on Wednesday, 04 May 2016 05:37
 

May 2016 Editors Comments

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Special Historical Reports

MRCI has begun publishing a new round of volumes in its series
of special reports each year.  Hot off the press:

2016 Historical Grains: a 174-page volume of seasonal
analysis for corn, oats, and wheat (CBOT,KC, MGE); includes seasonal
patterns for each delivery and for both intra- and inter-market spreads;
best of all, 122 seasonal and spread strategies.

2016 Historical Soy Complex: a 174-page volume of seasonal
analysis for soybeans, soymeal, and soyoil; includes seasonal patterns
for each delivery month, for both intra- and inter-market spreads,
and crush; best of all, 128 seasonal, spread, and crush strategies.

Call 1-800-927-7259 or 1-541-933-5340 or else send an
e-mail to This e-mail address is being protected from spambots. You need JavaScript enabled to view it to find out more and be among the
first to see this new research.

Physical Commodities

First, for those of you who wish to know a little more about seasonal analysis, MRCI, and/or your editor, you can listen to a blog interview of your editor by Michael Gross of Option Sellers at this link: www.OptionSellers.com/Toepke1.

Well, the CRB (stockcharts.com, click on Free Charts,
type into box $CRB) hit a double bottom low of significance
in February at 155, rose into March to as high as 179.  By April 1,
it had declined to about 168 about half-way back and approaching
its 50-day moving average of 166.  Will it hold and turn the Index
back up?

Precious metals are or have already pulled back to their 50- and/or
200-day moving averages which are in bullish alignment.  Corn
will go in the ground in April, soybeans in May.  Wheat will be harvested
in June.  What could go wrong?  Energies at best would
seem to be in a holding pattern with too much
actual and potential supply for almost any amount of demand.

But what about the US dollar?  Its March close was the lowest since
December 2014.  And what if the equity market loses its, shall we
say, "incredible lightness of being"?  Where will the money go then?

Perhaps we should be ready to ...

Trade 'em,

Jerry Toepke



 

Last Updated on Monday, 04 April 2016 10:40
 
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