Fed Holds Steady with No Plans to Hike Rates

The Stock indexes rallied all morning, but once 2:15 EST rolled around, we saw the indexes melt lower, still ending the day up, but giving back a major portion of their earlier gains..The DJZ had seen a trading high at 9887, but fell back and settled 100 points off that high at a final mark of 9781…SPZ500 had a high print at 1058, but broke 11 handles from that high, to settle at the 1047 level.. Both indexes still have a ways to go to challenge their Oct 21st High prints, with DJZ posting a high at 1060, and SPZ posting a high at 1098. […]

Waiting for Godot— UMM The Fed

Fed minutes are due out today at 2:15 EST… Traders and other nervous Nellie’s will be looking for the Fed telegraphing its plans to hold or start a round(s) of tightening…Seriously people, my advice is to go have a coffee break between 2 and 2:30, let the dust settle.

All that will happen, I imagine, will be a brief bit of volatility like a rubber band, where at most we will explore the trading ranges of the day..Perhaps the yield curve futures will have a bounce or two, but most of what the Fed is planning has been priced in at this time…Honestly, with interest […]

Rain Forcast keeps Grain Prices Firm as Gold Reaches new Highs

Today over all was very bullish as the index funds were heavy buyers of grains, in sympathy with the massive 30 dollar rally in Gold. That Rally of Gold was sparked by India taking delivery of 6.7Billion Dollars worth of gold, or about 1/2 of the gold which the IMF had been offering for sale..

The IMF is in the process of raising capital by liquidating a chunk of their precious metals..Be that as it may, we traded up to 1085 and change…The next stop for gold will be 1100, and then each 100dollar milestone will most likely be called off on a daily basis […]

Thanks to Computers,,, There is no Flow in the Markets

Computerization of the futures market for order entry and execution eliminated any semblance of flow in these markets, in my opinion… Computers are responsible for the ridiculous level of volatility, due mostly in part the the fact that we went from transparent markets, where all could see and hear the bid/offer and size…That worked well for over 150 years…We have replaced transparency with INVISIBILITY..

That is why we have such severe large moves, marked by a flurry of rapid jumps… followed by almost no trade at all…we have a situation where its computer algorithm vs computer algorithm…This fact has effectively destroyed the inter market spread […]

Gold Leads the Way as we all become dollar speculators

India took delivery today of 6.7BB in Gold from the IMF…That bit of news, along with the stock indexes holding up surprisingly well in the face of the bearish news from London regarding RBS and Lloyd’s continued restructuring, are the top stories..
As I wrote this morning, we are trading crude oil in the grains… crude oil is sharply higher, ditto for grains…

We have crude pushing higher, gold posting a high at 1084.70, Silver joining in with a high at 17.8, still a buck lower than its high last month at 18.15…
Corn Wheat and Beans are all moving higher in sympathy, with SX […]

Morning Outlook is Volatility

As we enter Tuesday’s trading day look at the following factors:
1) Crude Oil prices and the trading range of the US Dollar index
2) Export news for the grains, as well as any hint of further delays in harvesting.
Yesterday’s crop progress report has corn still on the low end at 28percent, and Soybeans at 52 percent harvested. Both are way behind 2008 schedules…
Time will tell if the rain affected crop quality of yields…Both crops were looking huge in September, so the damage would have to be spectacular to really have an impact, but it could be enough to squeeze out speculative […]

It was sub-prime, now its “dollar-carry trade”

For the past 3 years, the talk was the sub-prime crisis…Now it seems the new fascination in the financial press is the dollar-carry trade, which is exciting because it gives the TV analysts something new to wring their hands over and explain to it viewers.

Basically for a long time we had a yen carry trade, which speculators used the yen as currency of choice to borrow and use to trade with. That activity still exits, however, with the dollar being liquefied during the last year, the us dollar became a more attractive (cheaper) alternative…So now as currency fluctuations do their thing, it impacts the […]

November Rally Hats

Ford came out today with bullish news, the only manufacturer not to take tarp money, posted a billion dollar gain… Perhaps Hillary would like to impose a windfall profits tax on them?

Other bullish news, 1) Institute for Supply chain management, a private entity, sees GDP at 4.5 percent growth.., 2) pending home sales rise, and 3) China reports higher manufacturing output.

In response, the Dollar/Crude has been all over the place, but overall the Crude is about 2 bucks higher, Gold rebounded 22 bucks on short covering and fresh long specs, and the grains moved higher overnight and early on in sympathy with the […]