Tipping Point 9/16/10

A number of markets appear to be reaching their tipping point; indices, metals, agriculture and currencies all fit that bill. A correction in Crude back to the trend line and 20 day MA as predicted in recent posts. We think bulls will dig in their heels and prices should bounce from here; aggressive traders should buy this dip. Those that have multiple longs from lower levels in Crude, heating oil or RBOB were advised to lighten up exiting 1/3 of their position. Natural gas has made its way to higher ground the last 5 sessions! Even in the face of a bearish inventory report an impressive reversal lifting prices back above the 20 day MA. Buy November futures and November call spreads. The last 4 days the S&P trading range has been 15 points and in our opinion this is a consolidation before prices roll over. The same resistance level that capped rallies in August appears to be capping prices once again. Clients have continued to gain bearish exposure in the ES via November options. Cocoa higher by 1.86% today and 4.5% in the last 3 sessions. Some clients are long December options anticipating 2825-2875. If clients are fortunate enough to book profits in their cocoa we will likely be looking to shift into shorts in coffee…stay tuned. We would suggest moving to the sidelines in lumber for now. Treasuries appear to be breaking support at the 40 day MA; on follow thru tomorrow we may see another leg lower. Ultimately we're still expecting 126'00 in 30-yr bonds and 121'00 in 10-yr notes. Cattle on feed report after the close tomorrow...the whisper numbers are 101 on feed, 99 on placements and 96 on marketings. Thanks to the same cattle trader we referenced in yesterday's blog some clients got long December on the open this morning only to see a powerful reversal with cattle closing 2 cents off their lows. He thinks $1.05 is doable in the coming weeks on the December contract. In the last 3 weeks gold has appreciated 5% reaching a record high and silver in that same time has climbed 15%. We left this trade early with clients thinking prices had gone too far. We're still thinking as such and are waiting for a correction to get clients long again…stay tuned. Nothing new to report in agriculture…still thinking a correction is due. We're suggesting aggressive clients to probe shorts in soybeans and soy meal and have advised most to buy a 30 cent dip in 2011 corn. Aggressive traders could start shorting the Swiss franc, Loonie and Aussie with stops above their recent highs. Currently our only spec play in forex is the Yen calls that were bought yesterday; December 120/125 spreads. Risk Disclosure: The risk of loss in trading commodity futures and options can be substantial. Past performance is no guarantee of future trading results. MB Wealth Corp. is not responsible and does not endorse anything outside of the content of this article authored by Matthew Bradbard; President of MB Wealth. Benzinga Recommends that you take a look at the SPDR Gold Trust GLD. The GLD is an ETF that tracks gold. The SPDR Gold Trust was up .56% in today's session.