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Lancers32 said:
War has always been bullish for commodities.
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Yes, logical, supply restriction and inventory build to avoid potential supply issues. Not incompatible with an underlying deflationary condition. Not all price rises are the result of an inflation condition, as you know much of the covid era has been these supply issues. It's hard to fathom that the Eurodollar system is short of USD while the US money base is expanding at the rate it is. The thing is, once this is over, it will likely go from under supply to massive over supply as demand for $ outside the US falls away. When? Peg that and you have the blow off phase for the gold market. JMO etc. For now I'm still staying with strong USD and stronger Gold for what will probably be judged by history as the 3rd leg (3/5 EW).

We will see.

Felix Zulauf pegged 2024 for gold strengthen in 2020 odd... he is looking good at the moment.

3/5 is supposed to be the institutional leg where most of the $$$ are made.... in theory.

Are we prepared to have Wall St on the bias confirmation team?
 
Zed said:
Yes, logical, supply restriction and inventory build to avoid potential supply issues. Not incompatible with an underlying deflationary condition. Not all price rises are the result of an inflation condition, as you know much of the covid era has been these supply issues. It's hard to fathom that the Eurodollar system is short of USD while the US money base is expanding at the rate it is. The thing is, once this is over, it will likely go from under supply to massive over supply as demand for $ outside the US falls away. When? Peg that and you have the blow off phase for the gold market. JMO etc. For now I'm still staying with strong USD and stronger Gold for what will probably be judged by history as the 3rd leg (3/5 EW).

We will see.

Felix Zulauf pegged 2024 for gold strengthen in 2020 odd... he is looking good at the moment.

3/5 is supposed to be the institutional leg where most of the $$$ are made.... in theory.

Are we prepared to have Wall St on the bias confirmation team?
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I'm on the same train I think for now. I'm a little bit long UUP (US Dollar) and long gold. I think both rise for awhile until everything breaks. That's when we go hyper-inflation and the system resets to whatever comes next.
 
Interesting day/week so far. Lots of indecision/mixed messages for the metals. Short term it appears as if the $ still holds the key. We are set up for an interesting and potentially pivotal day tomorrow.:popcorn:
 
savvydon said:
Interesting day/week so far. Lots of indecision/mixed messages for the metals. Short term it appears as if the $ still holds the key. We are set up for an interesting and potentially pivotal day tomorrow.:popcorn:
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And that's Not just for metals. It's Far, bigger and more important.

Check this weirdness out. The BBBY "stalking horse" bid was due today at 4pm CST. Gamestop just happens to tweet this at exactly that time. They have 2 days to announce after filed with the courts.



Am I nuts? Maybe. And for that I have good ole Clif (It doesn't relate but I like the title)

clifhigh.substack.com

Nut Soup.

How to win at Law.
clifhigh.substack.com clifhigh.substack.com
 
Today was a mired nothing burger in the markets. Drama moves to next week. Stay tuned...
 
Lancers32 said:
Anyone else think these maniacs would go so far as to burn Canada down to further their insane climate change bullshit narrative?
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Think of it like this...

Antifa starts fires like clockwork - literally.

Govt says might want to wear a mask (that won't stop smoke) because rioting with a mask is best.

Biden announces it's an emergency disaster in Canada so we're gonna sent money to help them.

Money never makes it to Canada, but funds Antifa riots.

Another ploy is we allocate money to clean up the dirty smoke-ridden cities, but you know it ain't going where they say it will.
 
Larry Williams who has been around for a very long time is anticipating a SM bottom mid July. He is very bullish for the long term. Looking for a near term correction here.
 
You might be afraid to buy commodities here but with all the negative sentiment world coming to an end any day now I wouldn't want to be short commods.


FyB-yRracAIGcsq.png
 
Current market consensus is a 73% chance of a pause, for the fed decision this week.
 

Up in Smoke

Famed billionaire Stanley Druckenmiller, who says he used to be really big on China as the rising economic giant of the world, now sees China as the fallen Goliath, having brought ruin upon itself because of Big Xi’s policies.
goldseek.com goldseek.com
 
As the U.S. Treasury Department refills its General Account by selling assets, $1 trillion in liquidity could be drained from markets, warned James Lavish, co-Managing Partner at the Bitcoin Opportunity Fund and Author of "The Informationist" Substack. This, in turn, could "break" markets and cause a sell-off.
...
The Treasury Department needs to raise funds to replace its cash balance, which fell from $723.3 billion to $44.8 billion over one year as the Treasury used its funds to fulfill government spending obligations. The Treasury General Account, which is the federal government's operating account, was used to fulfill these obligations during debt ceiling negotiations in Congress.

The Treasury needs $550 billion by the end of the month, as well as enough cash to fulfill retirement programs and other obligations. In total, Goldman Sachs and JP Morgan estimate that the Treasury needs around $1 trillion by the end of Q3 of 2023. To raise funds, the Treasury intends to sell assets, including short-dated T-bills.

"The worst case scenario would be that we issue so much debt so quickly that the Treasury market locks up, that we don't have enough liquidity," Lavish suggested. "I do expect there's… probably a decent chance that we still have some sort of credit event though."
...
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www.kitco.com

$1 trillion could be drained as Treasury 'breaks' market, gold and Bitcoin are good positions to take - James Lavish

www.kitco.com

:popcorn:
 
Wheat is up 50 cents from where I bought my calls but they haven't done much yet...probably just not very liquid.

ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero
www.zerohedge.com www.zerohedge.com
 
Voodoo said:
Wheat is up 50 cents from where I bought my calls but they haven't done much yet...probably just not very liquid.

ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero
www.zerohedge.com www.zerohedge.com
Click to expand...


Wheat or WEAT?
 
Voodoo said:
Both, WEAT is the ETF that tracks Wheat prices. So I bought WEAT call options technically.
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That's why I asked if you bought futures or the ETF. Horse of a different color it would seem. You actually didn't buy Wheat. Have you seen how poorly the Natural Gas tracker funds have performed compared to the underlying?
 
Lancers32 said:
That's why I asked if you bought futures or the ETF. Horse of a different color it would seem. You actually didn't buy Wheat. Have you seen how poorly the Natural Gas tracker funds have performed compared to the underlying?
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Yeah, UNG is one of the worse ones. The volatility ETF's are horrid though in that regard. The drag on VXX is horrible. I have so far avoided getting involved in futures but maybe if I make some money and grow the accounts I will wonder into that world. But, wheat is in Backwardation right now (a sign of physical shortages) but this also helps (the ETF like WEAT) because rolling the futures actually benefits instead of a drag when the futures are in backwardation.
 
The problem with the trackers so a lesser extent the futures is that the funds who run the trackers own so much of the underlying they are skewing the markets. At least in regards to Natural Gas now. Probably just better off dipping a toe into the mini futures to get your feet wet. Or options on the full size contract. Not saying you are a neophyte don't misconstrue.
 
Voodoo said:
Yeah, UNG is one of the worse ones. The volatility ETF's are horrid though in that regard. The drag on VXX is horrible. I have so far avoided getting involved in futures but maybe if I make some money and grow the accounts I will wonder into that world. But, wheat is in Backwardation right now (a sign of physical shortages) but this also helps (the ETF like WEAT) because rolling the futures actually benefits instead of a drag when the futures are in backwardation.
Click to expand...

Not seeing backwardation here.


CBOT wheat

The contract size is 5,000 bushels of wheat (~ 136 tons) and the tick size at $ 0.0025 per bushel ($ 12.50 per contract). The contract months are March, May, July, September and December. The last trading day is the business day before the 15th day of the delivery month. The electronic trading...
www.zmp.de www.zmp.de
 
Grains are still a pretty local product. I guess I was on silver and just breifly checked one Wheat product. It wasn't even this one but similar. This is KC Winter Wheat

www.cmegroup.com

KC HRW Wheat Futures Settlements - CME Group

Find information for KC HRW Wheat Futures Settlements provided by CME Group. View Settlements
www.cmegroup.com www.cmegroup.com

Although, now that I check it seems like the Soft Red Wheat is the more traded one and is Not in Backwardation. So a bit of a mixed bag there.

www.cmegroup.com

Chicago SRW Wheat Futures Settlements - CME Group

Find information for Chicago SRW Wheat Futures Settlements provided by CME Group. View Settlements
www.cmegroup.com www.cmegroup.com

Also, its not just Wheat. ZH now talks about Cocoa which I noted in that graph before with the most Paper contracts holding down the real prices of the soft commodities.

ZeroHedge

ZeroHedge - On a long enough timeline, the survival rate for everyone drops to zero
www.zerohedge.com www.zerohedge.com

Bottom line.... "There are just some grocery store aisles where inflation looks exceptionally sticky."
 
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Looking to add a small piece today. Like a big gap down in the Silver miners this morning. MAG.
 
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