10-20-2010 09:08 AM
Good morning.....Looks as though we are going to have a little boomerang effect on the opening with the dollar losing some of its ground grains will make back some of theirs. I wish it was as simple as that but with the weather OK and no new bullish news on the horizon I am skeptical of the ability for us to stay bid.
Like I said yesterday we have a higher likelihood of consolidation for the next few weeks than anything else. Dollar is weaker so stay out of the way on the open and let the sheep do their thing.
I'm calling corn 8 to 10 higher to start with wheat 3 to 5 higher and good ole beans 12 to 15 higher.
10-20-2010 10:26 AM
Well it was probably silly to expect the "sell the dollar, buy everything" trade to go quietly without a fight. Dollar is giving back all of yesterday's gains and other currencies are gaining back their losses. Still feel like the dollar bottomed last Friday or very near to a bottom. I think this will probably be a last gasp for commodities, currencies, and equities.
I was always taught that markets are the most volatile at tops and bottoms. I'd say things are pretty darn wild right now.
10-20-2010 11:36 AM
If you look at the SP 500 chart as a proxy for the"it's all one market", this move looks very much like the final push of the correction that ended in May with the flash crash. A five wave structure is sort of evident but the corrections are shallow and each successive upleg is at a slightly less steep slope of ascent. Makes sense in a ram and jam deal, really.
In the May event at the end of 5 the market sent about 12 days going sideways while da playas looked around trying to find people to distribute stuff off to. The flash crash occurred when they couldn't, algorithms be damned, it is just that simple.
I'm not saying we'll have a flash crash in fact I'm kinda thinking we won't, that surely the PPT took a good look at what happened there and made a note to not let that happen again.
Ergo, it will get distributed off to the PPT?
Interesting idea, talk about moral hazard on a massive scale.
10-20-2010 11:42 AM
If the market was to chop sideways for a dozen days while da boyz try to find somewhere to offload the booty that would take us about to the election, or past.
I can't think of a better way to get the lame duck congress and then all the newbies ready to play ball than for the market to take a big dump. The need here is to hold a gun to the public's head so that the mortgage crisis is taken care of quickly.
Which is a bit the opposite of suggesting that maybe it all gets unloaded on the PPT. Both would seem to be viable scenarios, the idea that this isn't phony isn't.
I know I'm nuts but not as nuts as people who think this is real.