Wade Assurance
  • Home
  • Speculation
  • The Pit
  • Resources
    • Futures Contract Specs
    • Tools
    • Terminology
    • Past Trade Performance
    • Crop Overview >
      • Corn
      • Soybeans
      • Wheat
      • Supply/Demand Factors
    • About
  • Disclaimer

Various Asset Classes At Extremes

12/29/2016

0 Comments

 
I made a bullish recommendation a couple of weeks ago selling wheat puts which is something you would do at extreme bearishness sentiment.  While sentiment is a key component of what I call an actionable place, its not the only component.  I also look for assets which are stretched well above or below a moving average, the commodity channel index (CCI) and cycles.  Secondary tools are fibonacci's, trend lines, price patterns, etc.

​There are a lot of asset groups which are at extremes now, and these will all influence grain prices to one degree or the next.  I want to just run through these to see where it is most likely fund managers will be allocating their resources.  I am going to start out with a sentiment chart overview.  Right out of the gate, you can see that the dollar (upper left) is one of the most overly optimistic assets, and the euro (lower right) is one of the most overly pessimistic assets. 
Picture

Dollar

The 3 year cycle low is due next summer.  Because the intermediate cycle has stretched 8 weeks beyond normal, I am expecting this to turn any day.  When it does, it will help grains tremendously.  I am expecting this to turn any day.
Picture
This, while sentiment is extremely bullish.
Picture

Stocks

Really?  You are in buying stocks here?  Fund managers are interested in pouring money into this market now?  I am sure big money is well aware that last years yearly cycle low occurred in early February.  They happen near the same time every year.   All the stock indexes look this way.
Picture
Picture

Energy

I don't believe oil has a lot of energy left (pardon the pun) to push much higher.  Prices are stretched above the 200 day moving average, and we are nearing the timing bands for cycle lows to occur.
Picture
Picture
Those are but a sample of assets which seem overpriced.  The following are my favorites to be long in....to own, at least for a couple months.

Bonds

Picture
Pessimism in the bond market has not been this extreme since 2006.
Picture

Precious Metals

Picture

Agriculture

The next two months will probably give us the best shot of locking in some decent prices (I hope), barring some sort of weather issues.  One sure way to sell at below average prices is to sell when you are afraid, and when prices are below the green 200 day moving average line.  Until we have higher than average grain prices, I won't be recommending to sell any.
Picture
On Friday, I am going to push out an "out of the box" recommendation for corn sales based on the premise I have made today.
0 Comments



Leave a Reply.

    Archives

    January 2019
    December 2018
    June 2018
    March 2018
    February 2018
    November 2017
    October 2017
    September 2017
    August 2017
    July 2017
    June 2017
    May 2017
    April 2017
    March 2017
    February 2017
    January 2017
    December 2016
    November 2016
    October 2016
    September 2016
    August 2016
    July 2016
    June 2016
    May 2016
    April 2016
    December 2015
    November 2015
    November 2014
    July 2014
    November 2013
    October 2013
    September 2013
    June 2013
    May 2013
    April 2013
    March 2013
    February 2013
    January 2013
    December 2012

    Categories

    All
    Brokerage
    Carryout Worksheet
    Corn
    Crop Insurance
    Cycles
    Dollar
    Oil
    Soybeans
    Wheat

    RSS Feed

    Corn Cycles

    Terminology

    Track Record

Steve Wade and Tyler Wade of Wade Assurance are associated persons for AgDairy LLC.

                           Commodity Risk Disclosure Statement

The risk of loss in trading commodity futures contracts can be substantial.  You should, therefore, carefully consider whether such trading is suitable for you in light of your circumstances and financial resources.

Wade Assurance is an equal opportunity insurance provider.
CONTACT US
Steve Wade
swade@wadeassurance.com
​
Tyler Wade
​twade@wadeassurance.com
Picture
270-234-6074
  • Home
  • Speculation
  • The Pit
  • Resources
    • Futures Contract Specs
    • Tools
    • Terminology
    • Past Trade Performance
    • Crop Overview >
      • Corn
      • Soybeans
      • Wheat
      • Supply/Demand Factors
    • About
  • Disclaimer