What We're Reading

Commodities (58)

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Seasonal Demand Trades June 2014

Seasonal demand is just what it sounds like.  What seasons certain things see higher demand such as natural gas for A/C and heating or gold for jewelry manufacturing and sales.  With that in mind I thought I'd flip through our Seasonal Charts for hints of possible trades here and in the months approaching.  My unscientific belief has been that larger players begin to buy long futures contracts before the season hits so I begin to watch for divergences and support in charts.  Click on the charts below for a better view.  Let's take a look:…

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Pooty said in an hour-long TV interview on Thursday. “We sell gas in European countries which have around 30-35 percent of their gas balance covered by supplies from Russia. Can they stop buying Russian gas? In my opinion it is impossible.” Don't count your куры before they're hatched Pooty, old boy.

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Weekend Reads May 3rd-4th

  • Stocktwits: "investor say the bottom is in for gold"
  • Hey, wait a minute.  Didn't StockBuz say watch for a gold (GLD) weekly right shoulder to form back in March and early April?  Even posting on the gold miners here.  We're ahead of the herd once again......maybe.   (click image to enlarge)  At least risk…

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Amazing U.S. World Largest Petroleum Producer

Amazing the shift since oil rigs were shifted from gas to more of the black gold AND with Bakken coming on line yet sadly, gasoline at the pump has tripled........smh


In the span of a mere four years, U.S. production of crude oil has surged by 67%, according to the Dept. of Energy, reaching levels not seen since the late 1980s. Crude production is up 14% in just the past year. This is the fruit of new fracking technology and it is nothing short of astonishing. Natural gas production is up almost 40% over this same period, and—since natural gas is not easily exportable—this has resulted in a two-thirds decline in the price of natural gas, which in turn gives our energy-intensive industries a big competitive…

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Admin

La Nina, an ocean-atmosphere phenomenon where the sea surface temperature across the equatorial Eastern Central Pacific Ocean is lower than normal, tends to bring heavier than normal wet weather to the U.S. Midwest.  Yes, blame La Nina for the record snowfall the last few months.  It's all her fault.

El Nino on the other hand, brings warmer water to the sea surface and has a tendency to bring the exact opposite so you're talking possible drought conditions BUT just where does that wet weather go?  To coastal regions in the U.S., Chilean, Peruvian, New Zealand, and Australian coasts, among others.....causing landslides and affecting those crops.  As an example, an increase in …

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Admin

Gold: Sticking With It

It may not be a popular view but then again, when everyone's on one side, doesn't the market tend to do the opposite of what's expected?  It seems the Elliott Wavers of the blogisphere are calling for gold to head lower here but I stand by my call of last week that the low will hold and we'll see a head-and-shoulders bottom (right shoulder) forming here.  Silver and all of the miners reflect a similar pattern, as posted here at StockBuz last week.  The weekly even resembles a possible double bottom.  Wouldn't that be sweet!  At the very least, down side risk is defined (last weeks low) but with fear in the market and heavy selling continued after the first of the month, utilities (safe haven) are already hitting a new high and I believe flight to precious metals will…

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Admin

Hump Day Reading

  • For all the worrying about weather impacting job creation, Trim Tabs say real time tax receipt data (allegedly more reliable than BLS data) suggests that the economy has been picking up steam.  24/7WallStreet
  • A 8.2% magnitude earthquake overnight off the coast of Chile with a 2 meter tsunami.  Supposedly mining operations have not been affected buy you try to tell that to silver and gold this morning.  They're not buying it (so far)
  • Interesting metrics from …

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Admin

All That Shines, Gold And Silver

Sometimes it pays to simply remove the distraction of moving averages and let the chart movement speak for itself.  What say you StockBuz?  Are those head-and-shoulders bottoms or no?  Long gold and silver (and miners) with a stop below last weeks low (to your tolerance).  Partial on a breakout, move up stops to b/e, final target equal to distance of head to breakout zone.  Call it flight to safe havens, call it massive short covering/profit taking, .  Who cares.  The risk/reward is irresistible.…

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Admin

Daily Reads

  • The argument to lift the ban on crude oil exports Bloomberg
  • How big oil (and Senators) are positioning at the Senate Energy and Natural Resources Committee Bloomberg
  • A 3pm gold "fix"?  This study says it began in 2004. Bloomberg
  • That's what I've been saying.  Fed may have to let inflation run hot to meet goals. Reuters
  • Markets spooked as confirmation came of Russian troops taking over two airports in the Crimean area of the Ukraine.  UN to hold closed-door session this…

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Admin

2014 Recession Ahead?

If so, blame Mother Nature.  I dread seeing my next heating bill and will most likely be selling a kidney on Ebay to cover the cost.  A 2011 research paper by James Hamilton highlighted how historically, recessions occurred after a spike in crude oil prices.  Well what do you think we're witnessing in nat gas here?  Sure, it's an enormous short squeeze but what will the record snowfall, cold temperatures AND a spike in natural gas do…

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Admin

It's one thing when prices are lowered to spur demand.  It's an entirely different situation when buyers "demand" lower prices and can hold out until they get it.  Potash names such as POT, MOS and IPI saw a 20% haircut in market cap last month even though potash prices themselves had not "plummeted" as forecast.   So which is the tail and which is the dog?  It would appear the stocks definitely were the leading indicator.   This from the WSJ may just be the tip of the iceberg lettuce.

"Indian potash buyers are (now) demanding discounts for the price of the key fertilizer ingredient as the Russian miner that shook up the sector's cartel…

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Admin

Big Commodity Moves Ahead?

"A couple of weeks ago, we recommended to clients to buy the September Natural gas $3.50-$3.60 put forabout $500-$900/contract for a potentialprofit of $1200-$2,000 (3x to 5x) return over the next month." From Cumberland Advisors hat tip @Ritholtz

However GannGlobal is proposing a runaway move in commodities is fast approaching.  If you're a believer in "herd" mentality (that big investors move together as a herd and the herd moves the market), you may wish to checkout their video and register for their free webinar

This would make sense with the breakout in…

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Admin

Natural Gas Outperforming Crude Oil *booyah!*

[Edited October 15, 2012 to add Reuters link and Citicorp PDF ]

Natty outperform black gold?  Texas tea?  Yes it's happening and the intriguing part is it could continue.  It's unimaginable, unheard of, pure heresy but it at the same time, appears to be the Captain Obvious trade to these novice aging eyes.  While I'm no guru and don't begin to know it's intricacies, allow me to explain from a technical analysis and common sense point of view.  [CLICK ON ANY CHART TO ENLARGE]

 

#1  Falling crude oil demand in developed countries continues and this decline is expected to continue going forward......while increasing demand is expected in developing countries however I doubt quite a rapid increase given…

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Crude Oil Spikes and Historic Recessions

"I've just completed a new research paper that surveys the history of the oil industry with a particular focus on the events associated with significant changes in the price of oil. Here I report the paper's summary of oil market disruptions and economic downturns since the Second World War. Every recession (with one exception) was preceded by an increase in oil prices, and every oil market disruption (with one exception) was followed by an economic recession."

The table above itemizes the particular postwar events that are reviewed in detail in my paper. The paper also provides the following summary…

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