Gold has worked down from Alexander's time... When something holds good for two thousand years I do not believe it can be so because of prejudice or mistaken theory.
Bernard M. Baruch
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In the immediate future what comes out of Greece will be the driving force in the markets. August Crude gave up 2% today and is nearly $10 off levels from just over one week ago. Aggressive clients have light long exposure and are carrying losses and we will not be adding positions until we see an inter bottom. Clients own about 50-60% of the ultimate long we want to own but from about levels $5 higher. Those not willing to buy a standard futures could buy a mini or sell calls against their futures ...
No action by OPEC today reverses Crude and from here we should see higher pricing. July futures settled back over the 9 day MA and we should be on way to the 40 day MA at $104.50. The only dynamic that could slow appreciation is if we see a dramatic pop in the US dollar which at this juncture does not look likely. WE would be a buyer of dips in Crude and the distillates for speculators. Extreme hot weather has not allowed natural gas to correct as forecast but we continue to see significant resistance ...
Clearly the Fed has no clue and if this is a market with NO inflation I’d hate to see a commodity market with inflation. Crude fights back in late dealings to close marginally positive in today’ sessions. My opinion is this price action was position squaring and light buying ahead of Bernanke’s speech today and OPEC is on the docket tomorrow. Furthermore the strength in the distillates could have aided in Crude’s action as well. We will likely be looking for long exposure in Crude in the coming ...
This is not a reference to one specific market but rather a suggestion to NOT allocate all your eggs in one basket and trading markets NOT on every one’s radar. I am torn in Crude as prices could go either way. We printed a new high but failed to break out on the upside and overnight we tested the 20 day MA on the low. A new closing high would likely mean higher ground while a break of $110.65 in June would likely mean a 5% correction…stay tuned. The distillates came under pressure as well today ...
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