Volatility City

  • Posted on: March 18, 2011

Dow Jones cash settles at 11,858. We are still short from 400 points above on some contracts, with buy stops protecting profits.

I am out of the Dollar trade as of today. The bounce I was looking for was half hearted, and there is too much speculative action in the Dollar/Yen cross trade.

So, in my opinion, be short, or stand aside.

For those of you who read my letter, you can see how I was trying to buy the panic break in the grains.
The bottom came when I had gotten down to a skeleton position after being repeatedly stopped out on new longs as my protective sell stops were triggered.

The rumor that China bought corn, complete with the downside blow off action in the wheat, makes me feel comfortable that the range is in for the Spring in the grains.
Now it is going to be 1) planting delays, or 2) yield concerns.

I am still very friendly beans and used Tuesday and Wednesday to improve long positions already on the book. I rolled 1460, 1440, 1400 calls in SK all down at least 1.00 for 15 cents a bushel.

I am still short crude, but not aggressively so.

As for the gold, I am patiently waiting to sell the socks of at 1450.

That is all,
Have a great week.
Hope you made money.
CER