Gold has now regained the form it saw in 2009 to start the year off with a $80 rally from $1,070 to $1,150 as the USD weakens against a basket of other major currencies.  The USD had gained momentum heading into 2010 but has lost some steam with the Euro/USD trading from $1.42 to $1.45 increasing the appeal for the precious metals markets.  Silver is actually outperforming Gold here as this market trades up to a high of $18.70.  This market couldn’t get passed the $18.50 market last year but so far has been doing quite well now looking to head to $19.  It seems that the sell off to end 2009 was a huge buying opportunity for some investors and now is looking back to form in the new year.

It seems the Oil market is a bit overcrowded here above the $80 level as prices soared up to new yearly highs in recent weeks with the bitter cold weather conditions in the US.  Crude oil has halted here at $83.50 and has been drifting lower the passed few days even as wti spreads strengthen with the feb/mar above -50 now.  the last time Crude rallied above $85 was back in early 2008 when the wti spreads flipped from cantago to backwardation and oil rallied to $147.  It doesn’t look like that is going to happen yet here with demand still somewhat on the weak side.  It will be interesting to see where these spreads go from here with the flat price unable to break the $83.50 level.

The all important WASDE report is due out tomorrow at 7:30 AM CST. This will offer us a final look at 2009 production as well as a good look at 2010 S. American production. I do not expect any major changes to consumption with the US government sitting on their hands concerning Ethanol and the mandate. Overall it should be a benign report with ending stocks looking larger across the board, S. American production expected to see small increases allowing world ending stocks to move higher. This should be a bearish impact countering the continual gains in OI via money flow due to Goldman.

The era of push button markets has me on the defensive as my income is derived from executing option trades for customers. Computers do not provide all of the safe guards of using an experienced professional. Additionally, the desire for funds to receive one price, (so its easier to allocate), is troublesome for me as one price becomes more important than a better price on a partial. That concept is foriegn and doesn’t sit well with me. Sorry, but it makes me sad. I always try to fill orders at the best possible price and some size orders in our smaller markets cannot always accomodate the large volume demanded…… 

Looking forward to assisting, Jurgens

Unemployment numbers seem to be moving down but seem to be far away from positive territory. The government is trying to help industries grow in order to help consumers land jobs. This may take time but the market seems to be rising on hopes. Is hope enough even though the numbers don’t show? Manufacturing data and other growing areas have shown obvious signs of a recovery. A supposed double dip recession is possible but has never happened. Outside influences could hinder the markets such as terrorist activity. If these extremist idiots do another 9/11 incident we could see a huge pullback in the market. Do not think for a minute we are out of the woods yet. We are vulnerable because of the past recession and uneasiness by consumers to jump back in the market. Wall Street is doing fine but what about the people on Main street!

With the goldman buying spree officially starting tomorrow the trade is consolidating lower. There are expectations or massive buying but the problem is we have an entrenched weak long, especially in corn, reference OI gains if you doubt me. the market is in jeopardy of falling off no matter how much buying comes in due to the longs , weakening fundamntals and the weekend. I like fading any major move to the upside, with corn your best bearish bet.  MPI