FOR TUESDAY: (5/23) Bean plantings were below expectations for 56% but still average for this time of year. The 29/30 day cycles are lower on Tuesday and are inclined to expect lower prices for a few days now. Need to see wheat break; otherwise we would be concerned. The cycle into Thursday is often rather bearish for many markets and we would rather be short cattle and grains.Continue reading
Stocks look like a buy on Sunday
FOR MONDAY: (5/22) We are always nervous about putting out orders over the weekend break given the political circus going on but it does look like stocks are a buy on Sunday if nothing happens.
JUNE E-MINI S & P 500
S&P ANALYSIS FOR MONDAY: (5/22) Support at 2376.50 and 2374. Market did fail at the 78% retracement area of 2388. Next push up projects 2400. Much under 2370 and the market may be doing a congestion triangle. The more bearish pattern would to be that if we do get the 78% retracement, it would set up a huge congestion triangle pattern between 2350-2380. Bears who missed Wednesday’s fall have to remember that funds and cheap money will come to the rescue—because that’s what they do. We feel that chills and spills may be happening from mid-June into October but we usually get complicated topping energy in late May and early June. We did get technical sell signals on Wednesday but that doesn’t mean the market has to go straight down right away again.
Cycles for Monday look particularly friendly so unless NYT or WaPost come up with new scandals, the trade will go back to buying the dips In fact, we looked at cycles for next week closely and probably only next Friday into Memorial Day does the market start looking really vulnerable again so we should look at this as a sucker punch. We had thought about early June as a secondary high. We’re not quite ready to go for new highs but there are some patterns that can be read that way and nothing about this market will surprise us. So I think we have to forget about Wednesday and see what develops on recoveries into next week.
As for the rest of the day, if the market cannot fall much below 2375, then I suspect the market is going to recover higher. Complicated political crosscurrents are going to increase volatility.
There a patterns that would allow 2400 and then a push to 2340 and they are not out of the question.
LONGER TERM: (4/26) Expecting that 2150 is the most likely first downward target into September/October if the market can close below 2300. May not get the sell signal until June.
CYCLES OVERVIEW: Higher Monday; generally lower into May 24.
Grains higher on Monday
FOR MONDAY: (5/22) Corn futures closed higher for the day and for the fourth straight week as rain and cold weather may impede the last of this year’s planting and possibly cause some fields to be replanted. Soybeans finished higher for the day but lower for the week. Investors are watching action in Brasilia, Brazil’s capitol, where President Michel Temer is being investigated for bribery. The Real on Friday recovered about half of what it lost yesterday when the allegations were first reported. Wheat had big daily gains with hard red winter wheat recovering nearly all that it lost earlier this week. Severe storms and flash flooding are expected in the plains today and in the Midwest tomorrow, where winter wheat needs dry conditions.
We can see grains higher on Monday if they react to the weather but that may be higher for the week so if you’re short, you have watch stops.
Topping action: tread carefully
FOR FRIDAY: (5/19) We‘ve seen enough of these sucker punches to know that we had to be careful–and low and behold, it came and delivered. Next week’s James Comey hearing is certainly setting up as a ‘grab yr popcorn’ moment with Democrats lining up for their 5 minutes of fame to ask the question that ‘proves’ Trump deserves impeachment. However, it appears there is no need for the hearing as Mr. Comey already confirmed – under oath – that “he has not been pressured to close an investigation for political purposes.” Testifying under oath in front of the Senate Judiciary Committee on May 3rd, Comey states that he has not been pressured to close an investigation for political purposes, “not in my experience.”
So where is the truth? The press is selling copy by making up stories with evidence and there is certainly a witch hunt out there and it is not good for the economy or for getting business done and we’re all sick of it. Cycles suggest it will get much worse in July and August so get your popcorn warm ready.
We originally had a dollar high for Friday and gold low and we will assume that will continue. Still, the Times or WaPo will come up with something else to sell more copy and CNN will continue to rant. Will we ever have truth or a government interested in the people rather than battling out in the arena?
Topping action is never easy and you can see what happens when you chase so will tread carefully.
Cycle lows for grains dominate next few days
FOR FRIDAY: (5/19) Cycle lows for grains dominate the next few days and not sure the market can turn up until after May 25. We would continue to favor shorts until then. Short-covering on cattle may continue one more day but the market will probably stay under pressure through next week, and overall seasonals are lower into June.Continue reading
Stocks look higher into end of week
FOR TUESDAY: (5/16) Well, stocks survived a long-range missile test by North Korean over the weekend and just really cared about another false promise from OPEC. We’re not seeing this market run out of steam until the end of the week so we assume that it will go higher. Our cycle work is at odds with technicals this week. We often don’t pay much attention to Mondays as they are often low-volume. We have to see if the minor breakouts on silver and the Euro continue and if not our original work will be on schedule. We expect at least a retrace of Monday’s profits for most of these markets.Continue reading
Still have to continue to sell rallies in grains
FOR TUESDAY: (5/16) We have mixed cycles for grains the next few days and a low-confidence forecast. We have to take profits on short wheat with cold weather moving into Colorado and that may spook the market. It also may cause short-covering on cattle but may not be drastic enough to impact anything further East. Still have to continue to sell rallies in grains.Continue reading
Metals look lower on Friday
FOR FRIDAY: (5/12) More reports on Friday and lately Fridays have been friendly but the 29-day cycle is weak by 9-10 am and that may lead to a weekend profit-taking bout. Metals also look lower on Friday and it may be a dull pre-weekend affair.Continue reading
Grain cycles looking lower Friday, much of next week
FOR FRIDAY: (5/12) Cycles seem lower still for grains on Friday and probably much of next week. If weather forecasts stay warm and dry, the market will probably tank next week so Friday may be the last chance to get on new grain shorts or hedges for the short-term. Cattle showing signs of bottoming but we’ll be patient and hogs probably lower to sideways on Friday.Continue reading
Favor stocks bouncing on Thursday
FOR THURSDAY: (5/11) We have a bias toward stocks bouncing on Thursday and would love to buy a pattern completion but still looking for 40 ticks off the highs on NQ and not sure what will create that. The dollar looks higher all week and that doesn’t jive with a 2-day bounce for gold, which isn’t happening either. Luckily the news front is relatively clear compared to past weeks.Continue reading