Copper To Come A Cropper

Or so says ABN Amro Holding NV metals analyst Nick Moore in London. Apparently the fundamentals of base metals are deteriorating as the economy looks to be slowing down and more supply comes on-line.

Read all about it in this Bloomberg Article

However, in the same article analysts are bullish on Gold and Soybeans:

SNIP - Next year's commodity winners may include soybeans, which are poised to jump to a 15-year high as U.S. farmers, the world's biggest producers of the oilseed, devote more land to corn.

Gold may extend its rally as the dollar weakens and slowing economic growth prompts investors to seek a haven for their cash. JPMorgan Chase & Co. increased its ``long-term'' price forecast for gold by 9.5 percent last week on expectations for ``robust'' demand.

``Gold's going to be the phenomenon of 2007,'' said Michael Metz, chief investment strategist at New York-based Oppenheimer & Co., which has about $10 billion in assets. ``If I had to choose one commodity, I'd stick with gold.''

Folks really are bullish on the gold story and the gold bugs really do put up a convincing case. It's almost so universal I'm tempted to invoke contrarian theory and fade it. Buuuuuut gold can run up awful fast if something happens... options don't look that cheap to me either so I'll be holding off from anything rash for now.

Selling Some Premium on Grains

Todays price action in Grains just look toppy to me as they sell off the highs. I'm taking some off the table and selling some calls as per my previous post.

Time to lighten off some gold as well.

Payday

Corn making new highs...

....again, causing much whooping and hollering in the Avalon trading room....again.

Elsewhere there is a lot of bullishness on corn as well. Peter Korda od Slipka Financial Partners has made a pretty compelling case for all time highs in 2007 over at The Commodity Trader.

I'm quite happy to agree with him on this point.

Options are carrying a lot of IV so some covered calls might make good sense if this looks like consolidating in the near future, which it doesn't. Wheat has done so over the last couple weeks so who knows.

Grains Awesome

Funny thing this blogging. I am quite certain that not a single person will read this except me. There must be a million blogs in the same boat. Ah well, maybe some archeologists will extract this from the electronic ether someday and find out that Grain futures were humming way back in October/November 2006.

Dec Corn went limit up briefly today causing a bit of excitement in the Avalon trading room. I've been long grains for quite some time, adding or subtracting contracts as I go along.

Fortuitiously I added some contracts yesterday. Todays action looks sus'... a shooting star for those candlestick enthusiasts. So I took those extra contracts off. Nice enough trade.

Elsewhere in the CBOT grain pits, Soybeans look similar to corn, but wheat looking decidedly weaker.

Not that I'm bearish on the grains, but ferchrissake we must be due a reasonable retracement... unless these markets have decided to copy stocks and go straight up forever.