Risky Business 5/27/10
Based on the market action investors are piling back in with commodities and indices fighting for leadership. This may not be the bottom of either but certainly a tradable rally.
Energies higher across the board by 3-4%. Clients are long oil, RBOB, heating oil and we will be looking to buy natural gas once again in the coming sessions on a setback. Now with prices above the short term MA in oil our targets are $76.60, $79 and then $81.50 in July. We’re suggesting exposure in August and September to our clients. If you are long trail stops!
Bullish engulfing candle on the indices and if we can get thru the 200 day MA we should see a squeeze lift prices further. On this leg we would expect resistance at 1125-1145 in the S&P, 11500-11600 in the Dow and 1900 in the NASDAQ. July cocoa was higher by 2.38% running into resistance at the 50% Fibonacci level.
We have upside targets of 3070 and then 3200 but presently have no exposure with clients. Clients got hit a bit on sugar longs today but we still like the trade so stay put. We will be looking to establish some bullish plays in September coffee for clients tomorrow as long as we open flat or down tomorrow…stay tuned. 30-yr bonds were lower by 1.31% today getting closer to our objective. See previous posts…a target of 121-122′00.
If the failed rally in August lean hogs today spills over into tomorrow we should be able to get clients out at a profit…stay tuned. We generally do not like to be over weighted in any one sector with clients so as we ease out of shorts in lean hogs we will be getting clients long live cattle. Clients started buying December today when prices got above the 100 day MA; our initial target is 96-97.00. The 20 day MA supported
June gold today just above $1200 but we would like to get a trade closer to $1175 before getting clients long.
Silver was up on the session but failed to close above the 20 day MA; on a settlement above $18.45 we expect a trade above $19/ounce. Clients are long futures and options expecting just that.
As for agriculture we’re advising long exposure in corn, soybeans and soy meal.
As we’ve been preaching the dollar is acting heavy and IF the flight to quality money flees expect other crosses with the exception of the Yen to trade higher. We have clients long the Loonie and Pound; we anticipate .9650 tomorrow or early next week and 1.4800 in the same time frame.
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 United States OilUnited States Oil FundOil Fund (NYSE: USO). The USO is the ETF that tracks crude oil. The United States Oil Fund was up 5.26% in today's session.
