Con-tango

How to become a billionaire

 

Japanese Yen.
Courtesy of Bank of Japan Currency Museum.
 

Ok,
so I mistakenly thought the US real GDP for 2006 was going to be lower,
2.5 %, and it surprised with a high of 3.4 %. Then, what was it that
compensated the loss of growth in the US housing slowdown? From the latest BEA report and
looking at the fine print (Table 2), we find that the relevant items
with contributions above the 2005 GDP are:

• The export of goods with a
  0.24 % contribution,
• government expenditures (mostly at the state
  level) with 0.23 %,
• and a surprising cleanup in US inventories to the
  tone of 0.56 % …

…Christmas sales went well… and the states helped with some extra spending.

But, looking around for an excuse to my… blindness, I ran into the whopping sums that the US financial sector is harvesting around the world
–which I found a lot more interesting.

Continue reading…

I chickened out…

CL H7. Chart courtesy of Ensign.

Prices should continue their rally…
But, enough is enough… I’m out.
The jiggling around 13:00 hrs. hurt my account. Fortunately, from 13:30 on, I didn’t miss a beat…

And all in a… Friday.

11:28 stopped out

That’s it, I’m out –it’s bouncing…

CL H7. Chart courtesy of Ensign.

11:17 I’m in

Sold @ $57.26, due to failure of the 15 min $57.35 upwards breakout, the $57.10 low is acting like a magnet… Buy Stop @$57.40 –or at a failed failure…

CL H7. Chart courtesy of Ensign.

A Friday start

The daily chart is showing CL with a strong leg into higher prices. Apparently, the test of the $51 low held at the $54 price level. Yesterday, prices failed to breach the $58.20 high; so, a $57.10 price furthering the failure would be an immediate sell.

RSI, Williams R and CCI confirm the strong long bias. In particular, MACD is about to breach the 0 level, a significant threshold level. It is likely to bounce from it; but, if it doesn’t… It’ll signal a strong
CL H7. Chart courtesy of Ensign.continuation of the uptrend.

Continue reading…

The Contango

Hilary Till, Principal Premia Capital Management, LLC

Continuing with Hilary Till’s study, the next interesting find is the roll yield embedded in the term structure of futures contracts. In her own words:

In the past, even if spot commodity prices declined, there was an additional way that a commodity investor could have a positive statistical expectation of profit, and that was through the “roll yield” embedded in certain commodity futures contracts.
Continue reading…

The $55 USD/barrel pact

Source: Stockcharts.com

I was quite annoyed the other day; oil prices had been steadily falling and had breached the $51 USD support. Suddenly, prices reversed, with unusual strength, recovering and climbing all the way to $55. Needless to say, I didn’t like it because I got caught on the wrong side of a strong move.

Continue reading…