Here’s Heidler’s take on the week in grains, metals, and energy.
With the exception of the grains and crude, commodities fared ok this week. Nat Gas took a bit of a dip, but this is normally the bottoming season for it.
It was a relatively uneventful week until today. Things were shaping up to have the major indices finish in the positive until President Trump, in one tweet, referred to Chinese President Xi as an enemy and equated Fed Chair Powell to a communist party leader.
In part two of this short series on spreads, I will discuss the strategy behind the Ratio Credit Spread. We will use the term “ratio spread” when discussing this particular spread.
Wow. This week was amazing for movement in gold, silver and energy. Gold and silver caught a huge fear bid from the trade war fallout. This week, however, took the rally to extremes.
Interesting to look at these numbers. They don’t really tell the story. The real action started in the pre-market on Monday morning, the 5th, after China pegged the midpoint of the yuan against the dollar at a weaker level than 7 to 1, which has been seen as a line-in-the-sand for the pairing.
Unlimited risk is a term that doesn’t sit well with most non-professional traders. There are a few excellent ways to limit or almost limit the risk involved in selling futures options. We will discuss why spreading is possibly the best and most advantageous way for the average trader to approach options.
Finally the S&P started to roll over in earnest. Not sure how far it will go, but with the jobs numbers coming in low and the previous months being adjusted downward, I have to believe there’s a little bit of water on the coals of the rally.
Still looking for the grains to rally a little bit into the production report next week. However, my hopes for that may be misplaced, as any rally might only get us back to prior support at this point.
The grains continued to fly higher going into summer. Wheat and corn were on fire. NatGas took a pause with the energy sector issues.
No surprise that Utility stocks gained, with the flight to safety mindset over the last couple weeks.
Interesting week. Nat Gas held its own but didn’t pop too much. Seems good for those who sold premium on the downside.
With the VIX relatively low near 14 and the Fed Rate Adjustment decision coming up next week…
Bought 14 DTE iron butterfly wanting market to move.
This is a modified 14 DTE iron butterfly test.
Bought an iron butterfly with 14 days to expiration a $50 wide wings. Plan to hold to expiration.