T-notes due for a 4th-wave bounce

FOR MONDAY: (12/5) Given our experience with Trump and Brexit, how much and how long will markets be impacted by a “No Vote” by Italy and can we be surprised by anything else. I suspect that by the morning session, whatever damage has happened will be negated. If we can, we will put out a report on Sunday afternoon or night. In the end we can only trade patterns and cycles, and patterns suggest that stocks have to eventually go lower this month even if we get a freak bounce first. T-notes are due for a 4th-wave bounce to 125.22 basis March and the dollar should hold 102.22 basis March futures. While these moves look exciting, you have to buy just right and have big pockets. In the end, no one wins in the meat grinder unless you stay up all night and watch and monitor and use trailing stops.Continue reading

Bean patterns look complete

Bean patterns look complete and they lead the complex and may prevent too much more for wheat and corn. We’re moving stops down and will continue to look to take profits and need to be a buyer next week by early Monday if conditions warrant and set up. Cattle continue to issue technical sell signals. Leave hogs alone.Continue reading

Stocks watching European news

FOR FRIDAY: (12/2) Friday’s employment numbers may not mean much with a 98.6% chance for a rate hike Dec. 14 so even a bad number would not have an impact. The Italy vote and Austrian election seem more important for Sunday and given extreme reaction from Brexit and Trump, it’s hard to take anything home over the weekend. Either your top or bottom-pick very key numbers with big stops or stay out of a potential meat grinder where no one wins. Contract rollover to March currencies coming over the weekend and that’s a good reason to be flat there. Hard to imagine stocks blasting to new highs before European news and then we have ECB with an expected taper coming next Thursday. Currencies tend to over-react the most to these events and we’ll have to be flat for the weekend. OPEC good news is off sold off as they inevitably cheat on the agreements or fight later.Continue reading

Cattle cycles weak on Friday

FOR FRIDAY: (12/2) We may see end-of-the-week short-covering and bean patterns look complete and they lead the complex and may prevent too much more for wheat and corn. We’re moving stops down and will continue to look to take profits and need to be a buyer next week by early Monday if conditions warrant and set up. Cattle continue to issue technical sell signals and we’ll look to resell here with weak cycles on Friday. Leave hogs alone.Continue reading

Fund buying at first of month

FOR THURSDAY: (12/1) Trade is waiting for employment numbers on Friday, which may not mean much with a rate hike coming anyway and then Italy over the weekend. Hard to imagine stocks blasting to new highs before all that. Currencies tend to over react the most to these events and we’ll have to be flat for the weekend. OPEC good news is off sold off as they inevitably cheat on the agreements or fight later. For now it’s a good thing given that maybe deflation cycles are finally ending. Fund buying at first of the month for stocks can get delayed if it’s too close to employment report but not thinking it matters this month.Continue reading

Weak cycles for grains

FOR THURSDAY: (12/1) Grains faded the OPEC rally and we stuck with shorts but didn’t add to our positions because we’re approaching Dec. 1st and seasonals can turn up here. Normal cycles are weak here. Time to take some partial profits on shorts but still a good chance for lower prices on grains until at least Friday. Cattle continue to hold up but we do expect cattle down on Thursday and will decide what to do with it on Friday if it doesn’t fall much but it looks lower then also. Not sure how to play hogs with the rollover to Feb., which still needs to go higher.Continue reading

Congestion mode continues; Italy vote ahead

FOR WEDNESDAY: (11/30) Month-end position squaring should help US stocks come off. Trade has to be nervous about Italy over the weekend and that will increase volatility as we move into the end of the week. Sickly congestion that’s countertrend to last week isn’t giving much to trade but there may be reasons to get long bonds in case something bigger to the upside happens. Continue reading

Month-end position squaring in play

FOR WEDNESDAY: (11/30) Grain cycles are still weak into Wednesday and month-end profit-taking should set in and we have contract rollover from the Dec. contracts which go into first notice. Cattle look ready to rollover into Thursday but we rarely like to sell hogs on a Wednesday. Month-end position squaring will also add a new twist to trading on Wednesday.Continue reading

Congestion likely on Tuesday

FOR TUESDAY: (11/29) GDP and many other reports on Tuesday may get the markets moving again and then OPEC on Wednesday. At this point selling stocks and buying bonds and selling the dollar and buying gold are countertrend to the trends but that may be all there is for scalp traders going into the end of the month. We often see a big flourish early in the week and then congestion into the employment report, and that’s probably what will happen on Tuesday.Continue reading