Farm Futures' "The Buzz" for 9-11-09

The Buzz, September 11, 2009 from Farm Futures on Vimeo.

Natural Gas Snap Back

When shorts are forced to cover, this is often what happens. Short traders were forced to buy to liquidate their positions. Now, prices are selling off again. When prices move too far, too fast, this snap back often occurs. I call this the "rubber band effect". This was exactly what I expected. This was a 400-point sell-off, following a 1000-point week-long rally!

4 Hour chart

Late Day Grain Trading

I've noticed that during the 2nd half of the trading day, grains almost always move higher. They put in lows early, then consolidate and move higher -- even in a downtrend! Easy money!

Soybeans Drop to $9 Handle

and on strong demand and a weak Dollar. Amazing!

Natural Gas Rises 1000 Ticks In One Week

Stocks Turn Red

Gold Hits $1013

They Are Monetizing the Debt

Daily

Grains Turn Bearish on USDA Report

I think much of this is technical follow-through versus fundamental trading. Beans are now close to the July lows. Corn his hanging on just 8 cents above the July low of $3.02, and wheat is close to the lows of the year. With the Dollar dropping to another new low, foreign buyers will soon create demand.

Stocks March Higher Seven Days In a Row

If stocks closer higher today, as they are indicating for the moment, it will be seven days in a row.

It's a Dollar Downtrend!

New Dollar 2009 Low

New 2009 Stock Market Record

Natural Gas Rockets 450 Ticks In a Single Day

We're up 800 ticks in 4 days. Probably short covering, at least in part.

Up To The Edge for Stocks

Stocks have twice gone right to the edge during this trading session. Once overnight, prices went to the previous high of about 1038 that we reached last week. Then, we pulled back. Then, during the past half hour, we once again walked to the edge of the same price level, then pulling back. With the government intervening in the financial markets in a direct manner never before seen, it is probably only a matter of time before we break out to a new high.

New Stock Market 2009 Closing High

Unemployment Beneath the Government's Figures

Here are a few thoughts from David Rosenberg:
"What was really key were the details of the Household Survey, which provide a rather alarming picture of what is happening in the labor market.
"First, employment in this survey showed a plunge of 392,000, but that number was flattered by a surge in self-employment (whether these newly minted consultants were making any money is another story) as wage & salary workers (the ones that work at companies, big and small) plunged 637,000 — the largest decline since March (when the stock market was testing its lows for the cycle). As an aside, the Bureau of Labor Statistics also publishes a number from the Household survey that is comparable to the nonfarm survey (dubbed the population and payroll-adjusted Household number), and on this basis, employment sank — brace yourself — by over 1 million, which is unprecedented. We shall see if the nattering nabobs of positivity discuss that particularly statistic in their post-payroll assessments; we are not exactly holding our breath."

my note: This 1 million figure being true, this would be the first time in history that more than 1,000,000 Americans lost their jobs in a single month!

Dollar Sent to Slaughter

The Dollar is becoming a casualty of the unbridled printing and borrowing of money without restraint. Commodities are skyrocketing again for the second day in a row.
Daily chart - shows the magnitude of the break-out

Following the new CFTC limits imposed a few weeks ago, the natural consequence is beginning to impact the financial markets. The capital flight has already begun. The Dollar has broken out to the down side. Commodity prices across the board are skyrocketing in the past two days. Oil has exploded nearly $6/barrel, natural gas has risen 21% in 4 days (after a 14-mo. downtrend), gold has blasted through $1000/oz. and even the grains are rising powerfully after being in a downtrend. The longer-term consequences of monetizing the debt are beginning to take shape.

It will get worse. As the capital flight continues, the Dollar will be sent to the slaughterhouse, with commodities prices taking off. But this time, speculators can't be blamed because they have been sharply curtailed and position limits have been imposed. The worst is yet to come too, because the liquidity that funded the production of those commodities has also been curtailed. That means shortages down the road! I hope you have food stored in the garage. You're going to need it!

Wheat: Flat in July, Down in August

This has been a good year for both the winter and (so far) spring wheat crops. Wheat is cheap. Corn too!

Wheat: Up in May, Down in June, August