Risk is ON 8/12/10

We suggest continuing to trail stops on shorts or take partial profits in Crude oil. Could we go lower, yes…but prices have dropped 8.5% in the last week so this pace in our opinion is not sustainable. We suggested heating oil hedgers to establish additional hedges today; yesterday we advised January upside protection today December. Natural gas injections came in line with expectations today. We suggest scaling into long futures in October and purchasing November 50 cent call spreads. Indices punched back up to the 50 day MA’s but any bounce we view as temporary. We suggest remaining short expecting a trade to 1050-1025 in September S&P futures. For option traders in September ES we may opt to move positions out to October or November…stay tuned. Sugar is back above the 200 day MA; we suggest going to cash as prices could go either way. Breakout higher in cotton; futures traders should have been stopped out at a small loss. Some clients hold December put options and are under water. We maintain that 83.50 cotton is too high and expect 76/77 cents. On signs of a top we may suggest averaging in on the puts. Until we are convinced a top is in Treasuries 30-yr bonds and 10-yr notes will remain on our radar but clients will not be in the trade. Those interested in the short end of the curve could scale into shorts with tight stops. Recognize this is against the trend and clients have lost on this multiple times! December gold closed above the 50 day MA today for the first time since June 30th. Aggressive traders could buy the breakout with tight stops. As long as silver remains above the 200 day MA on a closing basis we are OK being long but on a breach a trade below $17 is likely. We suggest new entries trade December futures and option traders could buy December call spreads. A friendly USDA report helped Ag commodities gain on the day; corn was higher by 2.7%, soybeans by 1.3% and wheat by 2.6%. Wheat exports also aided in the rally as foreign buyers are shifting buys from Russia here to the States. As wheat goes so do grain prices. Today some clients were buyers of December 2011 corn futures and for option traders we suggested buying December $5.00 calls and October $3.80 puts ( a strangle). The dollar has advanced just over 3% this week and it appears there is more left in the bulls tank. Continue to fade rallies in the Euro, Swissie, Aussie and Loonie. 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 iShares COMEX Gold Trust IAU. The IAU is the ETF that tracks gold. The iShares COMEX Gold Trust was up 1.19% in today's session.