Friday, October 24, 2014

Beans, mmmmm

While the US markets remains so expensive, over-valued and over-bought, I feel that there really isn't much for the long-term investor to do other than sit on their hands or accept more defensive options at the expense of higher returns for now.

However, as a trader, options are aplenty. Oil is whipsawing up and down, so is Gold (strangely, disconnected from Silver). The major indices just went turbo overdrive the past week. There's actually a lot of things to trade if you're looking out for opportunities.

Personally, since my post back in August about the situation of Soybeans, I have been back in the bean trade almost following the seasonal graph exclusively. Good chart from Signal Trading Group.


Based on the last 5 years, Soybeans is going to hit a major high within the next few days. I'll be looking either for a pop or signs of weakness to take profit from my position soon. The trade has been working out quite well for me. Hopefully me talking about it before I close the position doesn't jinx it.

Other than this, I don't really have much going on at the trading front. Other than the good ol' shorts that I've been holding for weeks (epic squeeze the past week), things are pretty boring for me. I feel the markets has gone from oversold to overbought massively in the past few days. I am still adamant that this is just a bounce and that we will see the next leg lower soon, if not immediately. If we don't breach the previous lows, I might be easing off my short positions and admitting a small defeat. But, I shall remain vigilant and opportunistic, because I will win this war!

4 comments:

  1. I would rotate out of equities and into gold right now for the same feeling that equities are precariously toppy. Also, another reason to load up on gold is the issue with the Swiss central bank vote!! Could have a decent run up

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    1. Hi ladykiller,

      I enjoyed your trading war stories, very real and raw!

      I agree with you, I have been increasing my position on dips in the precious metals and their miners over the past year. Sometimes I feel a bit uncomfortable about the concentration I have there. After the first poll results, I think the Swiss gold vote might actually go through! If it heads up, I think it's going to move pretty fast.

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  2. Got Money Got Honey,

    Ah! You're a hybrid; an omnivore ;)

    Very few financial bloggers are into agriculture futures!!!???

    I am mostly into Simsci and currency futures. But I've been known to dabble in precious metals (real money) and energy futures too ;)

    Not yet into agriculture futures yet. But hope one day I can ride a big trend up up and away!

    May the force be with you.

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    1. Hi SMOL!

      Hybrid because no choice, a bit bored! Market seems like nothing compelling for investing, but for trading yes!

      I just look to see wherever looks like it has the best value! To be honest, I am not very confident about my ability to trade these agri futures well. Sometimes the volatility is crazy, like coffee at the start of the year!

      Energy futures like oil and natty gas? I used to do currencies, but very mixed feelings about it. I think position sizing is important for currencies. Have you done well in them?

      Thanks SMOL, may the force be with you too! :)

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