Tuesday

Agriculture And Natural Gas ETF

Post a Comment May 5, 2009 – 1:07 pm |   | Permalink |  Print This Post |

Our ETFs in Natural Gas and Agriculture are finally paying dividends. Patience is a virtue, and to be patient one must never be overleveraged. Breaking this golden rule will result in losses even with the right call. Our positions in Agriculture and Natural Gas are finally turning the corner. We were concern that markets would turn over before our positions would see the light of day. We have three times the number of Agriculture ETF contracts in our personal portfolio (which is still very light) - but feel that we are still probably too light. We would like to stock up on some agriculture stocks in the next pull back. Natural Gas may stay depressed for months, or even lower - but we see a massive rally coming up in the next 12 months.

Our indicators for tonight suggest markets will be down tonight, so to be safe we hope for Futures to head up before taking a short position.All indicators are pointing for a pullback. Our concern is markets are very near significant round numbers - the Australian 200 was 80 points to 4000; whilst the German Dax was 60-70 points from 5000. It would make nice headlines to achieve that in the next few days. Even if markets pull back tonight, we feel that it may be transient until our round number theory is fulfilled. This may drag on for another 1-2 weeks. If you have no position at the moment, a VERY SMALL short would be safe. We are still expecting a retest and significant tradeable pull back (none of this 1-2 down days).

We also reviewed our (closed) Euro/AUD positions - we got out at 1.82; it is now 1.79 (!) after a rally up to 1.86. We had our finger on the trigger but was waiting for 1.87. Euro/NZD on the other hand has gone back up to 2.31 (thanks to NZ lowering its interest rates to 2% and the few cases of Swine flu with zero mortality: a clear over-reaction). We opened a short Euro/NZD at 2.307 - the risk is for markets to pull back (traditionally Euro strenthens on market weakness). Best to your trading.

Agriculture ETF and Natural Gas ETF inflationist.com