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Veteran Advisor

music of the cosmos

I'm listening to music used by NASA in their productions.....Once in a while i like to listen to it, when i want to do some thinking........

It would have been a dream job working at NASA..........but it was not to be

 

what am i thinking about........many things............in particular, in this posting, the markets.......

I've read, talked to people, researched, etc............

I've come to the conclusion, we are a bunch of fools............myself included.

 

we hear the talk, we look at a few charts, the elevator man, banker, person on radio, tv, etc........"information".......

 

humans ask questions......it sets us apart from the remainder of the animal kingdon.......why.......such a little

word..........but most powerful, and perplexing.

 

i spent some time on the CME website........if you want a headache this is the place.....play with some of the tools, such

as their charts.....then look at the list of "indicators"....there must be at least 50 of them, i know the basics such as

RSI......but some i don't have an idea......zig zag...wobble.....

 

but many times, we can talk about the data, but if it is presented in a different, we think we can see a pattern.........

 

take a look at this

 

www.cmegroup.com/tools-information/quickstrike/options-open-interest-profile-agriculture.html

 

we are being told, too much grain, prices must go down.....production in the us, production in the world, etc...etc...........

even your's trulely has let this get to him and had a 7 & 7 the other night..........

 

we question ourselves, punish ourselves........we should have done this we should have done that.

 

but, looking at the data a bit differently, we see something else............you can see contracts where alot of the action is

actually long.....it depends on the contract........we can see longs are just about the same as shorts, in the option pits

it is even more striking........this is for all three major grains, corn, beans (sorry i use kchrw wheat)...a couple of contracts

are listed.........

an interesting one was OATS.........one contract just about all the option volume was CALLS.

 

that is usually a feeling in the market things are going to go up.....

 

tonight, a 20 cent out of the money call on MAR wheat would run you about 17 cents......or $850 if you went with a dec expir of the

same contract is would be close to 7 cents or $350.

 

the question is..........where are we........and where are we going ?

 

have we put all the neg news into the wheat market yet ?  in the wheat market itself, yes, but outside modification factors.......no

we have corn and bean harvest.......which usually find grains sinking to lower levels.......but if we get a surprise, we could

see some significant upturns in the markets...........

but will we ????

in the past several months, we have had fundmental information have little if any impact on prices......would a lowering

in the corn carry out or beans for that matter, really move markets ???

That is a nagging question in the back of the mind........

someone on here presented data on the huge numbers of trades there are made, or the open interest.....we produce about 13

billion in corn......but the annual open interest is in the hundres of billions.........try to wrap your ears about such a concept.

its difficult for a farm boy from the midwest.

have we crossed the line, where fundmentals no longer govern the trade, but all of the "indicators" do that.......

in my training of years back.......the fundmentals were the key......yes, the market goes up, down and all around, but that

was the base...........does it even matter anymore ???

 

we SHOULD be at a bottom........the harvest is in, it wasnt as big as past years, quality not good either....these are known.....

but we see the market fall........on such things as crop condition reports, rain reports, etc, all of which are mute, since

the crop, by most intents and purposes, is in the bin.

 

in years past, the smart play would have been one of the above things to do.........take the call out to mar...it would be

at the tail end of the crop, and if problems developing in new crop, some rise also, in addition, would have given time for

all the uncertainty to flush out of the beans and the corn............but, if they go thru the same as the wheat.....

would we ever get things cleaned out........

we are using alot of corn.......we have a blow average crop (which there is a chance), things could get interesting.....

beans, despite everyone putting them down........demand for beans is HUGE..........at my last look, beans were

about a 40 day supply, corn in the upper 50 days, wheat, better than 4 months tho.

looking at the demand, the supply, and if any yield burps...we should see better prices.........but with the "new" cme

will those basics and fundmentals come into play, or will it be like wheat ???

 

i just don't know anymore.......do you risk your money on calls ????

 

logic would say yes...........but the market is no longer logical........

 

when we use formulas that assigns factors on many varibles......first how do we out here, compete with such things ?

second, those factors and variables are not that strong.

 

have we come to the end of being able to market ???

 

i don't know

 

 

 

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Veteran Advisor

Re: music of the cosmos

Professor Don Gurnett of the University of Iowa Space Physics department is a good friend of mine and one of those who first got onto this music from space.

 

http://www-pw.physics.uiowa.edu/space-audio/

 

He is also a very good glider pilot and in addition has a T6 WWII trainer.

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