“Woe to the land whose king is a child and whose leaders are already drunk in the morning. Happy the land whose king is a nobleman, and whose leaders work hard before they feast and drink, and then only to strengthen themselves for the tasks ahead”. (Eccl 10: 16-17)


"When misguided public opinion honors what is despicable and despises what is honorable, punishes virtue and rewards vice, encourages what is harmful and discourages what is useful, applauds falsehood and smothers truth under indifference or insult, a nation turns its back on progress and can be restored only by the terrible lessons of catastrophe." … Frederic Bastiat


Evil talks about tolerance only when it’s weak. When it gains the upper hand, its vanity always requires the destruction of the good and the innocent, because the example of good and innocent lives is an ongoing witness against it. So it always has been. So it always will be. And America has no special immunity to becoming an enemy of its own founding beliefs about human freedom, human dignity, the limited power of the state, and the sovereignty of God. – Archbishop Chaput


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Tuesday, July 8, 2014

Soybean Chart Analysis

Ever since that last USDA report, wherein the agency surprised the market with a big jump in planted acreage, the beans have been on the defensive. That report, plus the continuation of very good growing conditions changed the dynamic completely in the beans. Prior to the report, the focus of many traders was the continued tightness in old crop carryover. Simply put, the market was of a mind to ration demand so as not to run out of available bean supply prior to this year's harvest.

It was that old crop carryover tightness that had been the driving factor particularly in the July and to some extent, the August bean contracts. New crop November had been yanked, tugged, pulled and generally distorted by the buying in those former mentioned contracts.

Now that the Quarterly report is out of the way, traders are looking forward to a massive harvest based on USDA weekly conditions ratings, as well as field reports. The result has been a complete and rapid sentiment shift that has caught many of the hedge funds leaning on the long side of this market. They are getting out of Dodge very rapidly based on what we are seeing in the weekly Commitment of Traders reports. However, as of last Tuesday, they were still net long. I am sure that has changed by now as the market has lost some 82 points since then.

I expect to see this week's COT reports showing them to having moved over to the short side of the market. 

The market is now anticipating this coming Friday's Supply and Demand report. Based on what we get out of that, we could see even more weakness if end users feel that they can buy, "Hand to Mouth" to meet their needs as they wait for harvest to begin. While the beans are certainly not out of the woods, as they are essentially more dependent on August weather compared to corn, it is not inconceivable that we could see them near the $12.00 level without some sort of bullish surprise in this report ( or a shift to a hot, dry weather pattern across the corn belt).



Indicators on the weekly chart are pointing lower. A breach of the $12.00 support zone would suggest an initial move to $11.50 and then to $11.00- $10.80 should that fail.

On the upside, this week's gap lower is initial resistance starting near $12.86 and extends to $13.00.

A quick note on gold - it is firm due to geopolitical events - first it was Ukraine, then it was Iraq, and now it is Israel and Hamas. One wonders, with the various commodity indices all retreating lower once again, how long the geopolitical concerns can keep it supported. Gold needs support from rising commodity prices.

28 comments:

  1. http://finance.yahoo.com/news/shale-boom-confounds-forecasts-u-072244250.html

    "Shale boom confounds forecasts as U.S. set to pass Russia, Saudi Arabia"

    It is all part of the plan. The globalists know the US will need to have much of its energy needs sourced from within N America (canada, mexico) by early-mid next decade. The oil drillers will continue to have growing business.

    The courts will continue to shoot down any lawsuits against the frackers, and production will continue to escalate. the ramp in production is all in time for the large war the globalists have planned, which will be the catalyst for bringing in the NWO.
    This is also very dollar bullish. This all comes at a time when the phenomena of the Triffin Dilemma was supposed to do in the USD. Guess what, it was just delayed another 10 years.

    The central banks of the world have to continue to figure out ways to keep the dollar from becoming stronger.

    ReplyDelete
  2. Hi all,

    Well if gold was not performing also because of investors preferring SP500, Russel, etc... then I'm also watching SP500 because I have a red alert on this indicator at the moment.
    Indeed, first we made it an inch from 2000, Big Number, come on, makes everyone think twice...so we made it at 1986 and stopped.
    Then we are globally in my danger zone I wrote before between 1950 and 2000.
    Here is the chart.
    Look on the monthly time scale...we are an inch again from the mlh sup in green (andrews fork) AND from a report of previous ranges.
    On the weekly time scale, this is confirmed by a great 123 MACD (MACD reversing down right on its propagation axis when prices kept going up, on 2 occasions. So the 3rd bounce down is called a 123 MACD, it means a double divergence between MACD and prices, which could be saying big trouble ahead.).
    So the point is to find a decent entry point to short SP500 on the daily time scale for me.
    I'll keep you posted about that, but I think I'll try a short of SP500 once more with a long term target down, and stop loss above the recent highs, should SP break under its ma20 or ema15 daily.
    Here are the charts :

    http://i61.tinypic.com/5khd81.jpg

    Have a nice day,

    ReplyDelete
  3. Energy futures getting completely annihalated.

    Meanwhile XRT and XLY still consolidating just under world record highs.

    This is "Economic Nirvana".

    Nobody would have ever dreamed of conditions as ideal as this:

    - Ability to print unlimited amounts
    - The world still clamoring for U.S. debt instruments of every type
    - Interest rates remain at rock bottom
    - Ultra loose and fluid capital markets enabling consumers to borrow easily
    - U.S. financial markets the total envy of the world
    - Central Banking at its finest, never ever as good as this

    ReplyDelete
  4. Dan, I just found your Donate button and sent you a C-Note.

    Thanks a lot for your analysis of crude 2 weeks ago, I was able to sell my UGA at the absolute top and lock in 3 years worth of gains.

    Thank you buddy!

    ReplyDelete
  5. more fomc horseshit; nothing more, nothing less. sorry.

    ReplyDelete
  6. Nice try gold bulls, but we know where all the miserable weak handed stops are upstairs.

    ReplyDelete
    Replies
    1. Anyone looking at trx being marked up? 12 august the 2.50 dollar warrants expire. Someone wants to fleece the sheep for another 2.5 million shares. That will ensure a couple more year of the board of criminals milking the company and luis the liar spread trading the share all over the place while absolutely nothing happens on the ground.

      Delete
    2. Jasper, it is very sad. The Casey guys are now replacing your buddies at kwn with their big shindig in San Antonio. Same guys, same bullshit, same tired stories. Casey is like a bad penny and never shows up heads down.

      Delete
    3. I noticed Casey is now peddling the bail in story too.

      Delete
    4. Jasper, get over it man … leave poor Jim alone , his, is a sound company , if you are looking for criminals , read about Gowex , and the hundreds of companies in the russell with dubious numbers . TRX will be 10 one day and you will still be complaining . sell them at 2.80 , and buy them back at 2 . Best

      Delete
    5. Poor Jim?

      What about the people that took Jims advice to sell their pension funds and buy "good gold shares"? The veruy shares Jim has been selling by the millions?

      They should "get over it"?

      I sold at 4 when it became clear Jim is a fraud, liar and market manipulator.

      TRX may or may not be at 10 some day, it will not generate a cent in revenue this de cade or the next if ever. It will produce shares and lies all the way to ten if it gets there and then collapse.

      Effin dolts everywhere you look.

      Delete
    6. Amen to that jasper. Btw back to mergotts fax, when did he post that on facebook and does he still work at trx?

      Delete
  7. Silver...volumes on the OBVD are scratching at the door of an important resistance level imho...which may make bears run for the exits is reached.
    On the daily time scale, prices resisted pretty well while CDUR cycle indicator went back down to its low zone.
    Conclusion : a close above recent highs may trigger a short covering rallye towards 22.20. It's possible that I put a moderate buy stop order around 21.40, depending on what the shorter time units indicators will say when we get close to that area again.

    http://i60.tinypic.com/24ysiv7.jpg

    ReplyDelete
  8. SP.
    Just FYI, on the shorter time units, I think I had an opportunity to short just above 1970 when prices broke through ma20 on the 1 hour time chart, while both 4h and 1h time chart MACD crossed and are now heading down.
    It's high risk but I put a stop loss barely above the 4h ma20, i.e around 1974.
    So, 4 mere points on CFD contracts, with a target at least at 1940, I have very little to lose and much more to win with a risk reward ratio near 8/1. I'll probably get stopped out, but on the long run, with such trades here and there sometimes, I think I still manage to make some small profit :)

    ReplyDelete
    Replies
    1. P.S : actually stop loss 1973 above last big down 1 hour down candle and 15 minutes last strong drop. So risk = 3 points. Reward = 30+ points if we go there. I don't know if SP 500 has more than 10% chances to reach 1940 at the moment, but I'll risk a small bet on it.
      Once more, I'm trading here because my risk/reward ratio is really big.
      Have a nice day,

      Delete
  9. Goooooaaaaaallll!! :)
    ok, well, nice 4 hour candle on the SP500 right on schedule (I'm happy, I thought the odds were again I'd be stopped out), so let's see if we can make it on the way to 1940 area (a bit above, target ma20 on the 2day timeframe) or if we will reverse up already.

    Nice move up through resistances for silver and gold, I'm long on both metals as a result...well let's see here once again if it's a one hour miracle and happy bulls dream turn into a nightmare before nightfall.

    Conclusion : Bo Polny, you are a fraud and a disgrace with your 20.000 $ per year newsletter. Your cycle bullshit newsletter is not worth a penny. You announced a june high for gold and a summer low. But it won't keep you from posting more crap and advertising everywhere. Good we have a few real trading FREE blogs such as this one to make SERIOUS analysis in this world of fraud and bullshit.

    ReplyDelete
  10. A tip of the hat from Sparks to Mark and Hubert on recent calls!

    ReplyDelete
    Replies
    1. Thanks Steve, maybe it's like rush time in poker.
      Still :
      - failed short at 1950 on SP recently, stopped out a bit higher.
      - failed long stop gold on 1326 stopped out 1319.
      - didn't take a long gold at 1240 because going to Egypt holiday...too bad, should have.
      So, reminder that certainly not all of my calls are correct :)
      Take care :)

      Delete
  11. Dan poses the question:
    "
    One wonders, with the various commodity indices all retreating lower once again, how long the geopolitical concerns can keep it supported. "

    Perhaps part of the answer may be in this missive of Jul 5th ( one person's opinion of course )
    http://www.moneyandmarkets.com/perfect-storm-driving-gold-higher-62875#.U76MhUAg_VE

    ReplyDelete
    Replies
    1. Wolf, a very good read and I thank you. Weiss has been around the block more than once.

      Delete
  12. Out of 25% of my short position SP500 at 1953 on non crossing and reversing up MACD on the 15 minutes timescale.
    Stop loss back at 1970 at entry level : zero loss policy.
    Not it's win or no loss as usual.
    This is much more important than being right all the time about the market direction imho...

    ReplyDelete
  13. oops...last thing to mention, I don't want to see gold closing under 1337, because it is a bloody fibonacci retracement level of 1180-1435, therefore a resistance on the way up as long as we are rangebound. Gold prices must imho get rid of 1337 on the close, say 1340 area, to avoid the risk of stalling once more as soon as tomorrow. So I'm ready to get out of my long gold positions as fast as I went in.

    ReplyDelete
  14. same same; you buy or sell the open and if wrong in the first hour, you bail.

    ReplyDelete
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