[MrBill]

The Europeans got sneaky for a change and pushed Brent up from a morning low of $6151 to a high of around $6228 before NY came in. However, it was all a case of sell the rally then because down we went afterwards with the opening in NY giving further selling impetus lead by product declines, especially, but not limited to, unleaded gasoline. Not sure where we will go fom here.

According to Mr. Bill's Rule we should stop at $6228 - 100 = $6128, but we are right there, right now, and have stopped. It has held so far, but we'll see how high we bounce before the bears give it another try? Some funds increased their shorts last week and if they did not panic and take them back on Friday then they will be looking for blood today. The first two months of the year have not been kind to them. Doesn't that just break your heart? ; - )

[truecougarblue]

Belated thanks cube.

[MicroHydro]

Just some random opinions without time to elaborate:

US govt bonds, housing related equities - sell em if you got em

oil, gold, silver - hold (if you have the equity to weather the volatility)

Long NYMEX natural gas (2008 and later), palladium, uranium - Buy

[truecougarblue]

$this->bbcode_second_pass_quote('MicroHydro', '
')
oil, gold, silver - hold (if you have the equity to weather the volatility)

[MrBill]

I bailed way too early on my crude short yesterday. Took a nice profit on the crude, but gave it all back and more in the unleaded, which has lost a dime in the past week. When it comes to trading unleaded I am like a deer in the headlights. Don't know whether to crap or get outta the way. Ironically, the original idea, buy March/sell April at -1600 has worked out brilliantly. It is now at -340. Why oh why do I do this to myself? Stick to my ideas, take my stop losses and live to play another day. That is the game plan in crude and it works, why try to get clever and out smart the market when it comes to products?

Too be honest, do not know where we go from here. During quiet periods we will tend to drift lower and sometimes plunge, but then come those geopolitical headlines and up we go, so hard to say when we are hovering just above $60.00 in the Brent and the WTI? My feeling is that we have come this far, we may as well break through support and try to find where the natural buying interest lies? Maybe consolidate in a lower range somewhere between $55 - $60 until the next blow-up in EEMEA/Latam?

There will no doubt be regional shortages caused by the changeover in low sulfur standards for diesel and switching from MTBE to ethanol. In addition, we have strong growth in Asia and a volatile ME, so supply & demand will be close enough that any supply disruptions will affect the price disproportionately to their size or severity. Especially if they last for any duration. Add to that the prospect of another active hurricane season in the GOM, plus lost production there already, and we have the ingredients for an interesting year. But in the meantime, we need to chew through some above average inventories and see if the drop in housing prices really is part of a trend of slower growth in the USA?

I think I am positioned okay. Short crude. Long unleaded. Long out of the money calls with 3-months time value left. I just have to keep myself shorter crude than normal if unleaded continues to lead the way lower and watch the switch from the HU to the RBOB contract.

RE natural gas. Sorry, I do not have the stomach to trade that one. Too volatile for me. Betting on 2008? It is like a binary bet. Don't like those odds. Also, I do not touch the metals. Just no time to do them justice. Prefer to keep my eye on a few markets and take bigger positions in them instead. However, the comments are always appreciated. Good to know what is going on in other markets, even if not active in them.

[Chuck]

$this->bbcode_second_pass_quote('MrBill', 'R')E natural gas. Sorry, I do not have the stomach to trade that one. Too volatile for me. Betting on 2008? It is like a binary bet. Don't like those odds. Also, I do not touch the metals. Just no time to do them justice. Prefer to keep my eye on a few markets and take bigger positions in them instead. However, the comments are always appreciated. Good to know what is going on in other markets, even if not active in them.

[MrBill]

$this->bbcode_second_pass_quote('Chuck', '')$this->bbcode_second_pass_quote('MrBill', 'R')E natural gas. Sorry, I do not have the stomach to trade that one. Too volatile for me. Betting on 2008? It is like a binary bet. Don't like those odds. Also, I do not touch the metals. Just no time to do them justice. Prefer to keep my eye on a few markets and take bigger positions in them instead. However, the comments are always appreciated. Good to know what is going on in other markets, even if not active in them.

[MOCKBA]

Any idea with what US online broker I could trade on TSX?

For that mater, what is the best Canadian online broker?

[MrBill]

$this->bbcode_second_pass_quote('MOCKBA', 'A')ny idea with what US online broker I could trade on TSX?

For that mater, what is the best Canadian online broker?

[MrBill]

Strange day here. Dipped as expected. Missed getting some out at the top of the range. Had an order in at $6117 and then high was $6114, then we dropped to 6050 and I took my short back at $6058. From there unleaded staged a nickel rally from $1.5460 to $1.6000 in early NY trading. That took crude up with it, but no follow through. However, it was the chance to get long at 6090 and shove them out again at 6125. The high so far in the Brent has been $6143, so the 100 point rule would have held, so far given the low before we came in was $6036.

Never the less strange price action given we are expecting builds tomorrow and maybe has more to do with contract expiries in the products than any real change in direction? From here I cannot tell what will happen at the close? The hourlies are indicating higher, but I sense the market lacks urgency, so just may collapse at or near the close?

Despite jobbing it around today, I am flat price square at the moment and having trouble to go short up here? Hate to fight against my model, but my feeling is that if unleaded gives up that nickel as quickly as it went up today (1.5760 at the moment) then this might be the best chance to get shorter crude to compensate me for the licking I am going to take in the unleaded?

Highs of the day here, itchy trigger finger. As you can tell I lack conviction which may be a good place to say goodnight and leave it alone before I cut myself. It is either that or sit here until the close and I am tired.

[MrBill]

Nope my model beats me again. Higher here on Nigerian problems. Just took out the interday highs in crude $6159 in Brent and $61.40 in Wti, so may see fresh buying instead. Good thing to sit on the fence once in a while.


Sold at $6150, put a tight stop on it and walk away before I hurt myself. G'nite.

[MOCKBA]

$this->bbcode_second_pass_quote('MrBill', '')$this->bbcode_second_pass_quote('MOCKBA', 'A')ny idea with what US online broker I could trade on TSX?

For that mater, what is the best Canadian online broker?

[MrBill]

Tough one overnight. Stopped out. Went a little higher, but not much. This morning, was leaning over and looked like it wanted to retrace the move higher, but now has found some support in early London time. However, this rally from yesterday does put the overall technical picture in a better light. Although not going through the roof, the technicals on the daily and weekly charts have swung firmly back above their moving averages (13 & 21 day on the daily) and look like they may test last Friday's highs at a minimum with plenty of room to the topside. This is surprising given we will have inventory numbers today. I have not seen any firm estimates, but the market is expecting a build. Will have to track those numbers down, as my regular supplier has discontinued sending me the research on a daily basis.


Of course, events in Iraq continue to spiral out of control on an almost daily basis and is erupting into an all out civil war which will have regional effects, especially on Iran.

$this->bbcode_second_pass_quote('', '[')url=http://english.aljazeera.net/NR/exeres/A53F5F39-9E34-4918-88B0-EEA54580E99F.htm]High Casualty Rate[/url]

The new bloodshed came as a reminder of last week's violent reprisals between Sunnis and Shias after the bombing of a Shia shrine in Samarra.

The Iraqi government said that since the bombing in Samarra last Wednesday, 379 people had been killed and 458 wounded.

However, the Baghdad mortuary confirmed that it had received only 309 bodies since Wednesday, most of them victims of violence. Mortuary data showed this was double the average - it handled 10,080 bodies in 2005.



"The people of Iraq and their leaders must make a choice. The choice is chaos or unity"

George Bush

In one of the attacks on Tuesday morning, a bomber blew himself up next to a queue of people waiting to buy kerosene in al-Amin in the southeast of Baghdad.

[MicroHydro]

$this->bbcode_second_pass_quote('Chuck', 'W')ell, I tried natgas for the first time. Bought a mini contract @ 8.80. You know with the MA200 @ 10.2 I thought it was a great buy. Just sit it out, because of the great volatility. And here we are, with natgas @ 6.70
Nice try Chuck!
BTW, I am approved for the Man-futures account. For the time being trading corn and crude only. The volatility in silver/copper and gold has cost me a fortune this month. And yes I know, it is not the volatility, it's me.

[MrBill]

Dante's Peak has posted a little on the DBC, here is some more on ETFs.
$this->bbcode_second_pass_quote('', 'T')he DBC looks and acts like an ETF, but its structure more closely resembles that of a commodity pool. This is the first ETF-like product offered on a U.S. stock exchange providing direct exposure to a diverse basket of commodities. Like an ETF and unlike your typical mutual fund, the DBC's share price is updated intraday and the shares can be traded throughout the day.

The fund and the underlying index it closely tracks (the Deutsche Bank Liquid Commodity Index) focuses on six key global commodities with liquid derivatives and futures contracts with the following weightings: Light sweet crude 35%, heating oil 20%, gold 10%, aluminum 12.5%, corn 11.25% and wheat 11.25%. It will be rebalanced back to these levels each November.

[drew]

$this->bbcode_second_pass_quote('MOCKBA', 'A')ny idea with what US online broker I could trade on TSX?

For that mater, what is the best Canadian online broker?

[Chuck]

$this->bbcode_second_pass_quote('MicroHydro', '
')Hmmm. Gold was only down 2% for the entire month of February, hardly worth mentioning. If you were hurt by that either you are either waaay too overleveraged, or might want to re-evaluate your trading strategy.

[pb_2_au]

Looks like 60 is the new 30...

http://biz.yahoo.com/ap/060301/opec_president.html?.v=4

Seems to me this points to long term $60 support?

[MrBill]

$this->bbcode_second_pass_quote('drew', '')$this->bbcode_second_pass_quote('MOCKBA', 'A')ny idea with what US online broker I could trade on TSX?

For that mater, what is the best Canadian online broker?

[MrBill]

Who was it that suggested we might just consolidate in a $55-60 range soon? Oh that was me. Sorry. That was then, this is now.

Key technical levels broken to the upside with my model almost fully long with exception of natural gas which is still negative. However, reaching key resistance points in heating oil and gasoil where they start to become overbought. Complex vulnerable to a resolution of any of the following problem hotspots and may trigger profit taking. Until then, maintain a long bias and look to buy on dips.

Russian output up to 9.45 mbpd from 9.43 mbpd in JAN
Russian exports up to 4.56 mbpd from 4.29 mbpd in JAN

Nigeria 450K bpd shut in since 2-weeks
Six out of nine oil workers released
The Movement for Emanicipation of the Niger Delts vows one, huge, crippling blow aimed at completely discontinuing exports of onshore crude oil (and someone wanted to know why didn't Nigeria want to build refineries in Nigeria to capture more value added?)

China urges Iran to comply with the UN Atomic Watchdog
Ali Larijani says, Tehran will not stop enrichment in Iran regardless of the outcome of talks with Russia over enrichment there
The EU3 are set to meet once more with Iran before the March 6th referral to the Security Council
Iran says talks with Russians overshadowed by veiled threats from the USA

Jordan has near miss from al Qaeda similar to last week's near miss in Saudi Arabia
al Qaeda blue print to target oil infrastructure, pipelines and ships revealed, but not to risk oil fields themselves

US crude stocks rose +1.6 mio bbls (up 9% YOY)
gasoline stocks rose +300k bbls (highest levels since 1999)
distillates stocks were down -1.3 mio bbls (still above ave)
natural gas f/c -104 -189 bcf this afternoon,
but nat gas continues to be under real pressure, so not likely to make much of a difference
meanwhile US refiners trim runs for heavy winter maintenance ahead of summer driving season

Ahead of March 8th OPEC meeting some OPEC members have unofficially called for cuts to production in Q2'06, but these reports cannot be confirmed.

And now for something completely different compliments of Dresdner Bank.
$this->bbcode_second_pass_quote('', ' ')Gold: Another generally positive day for gold. Early selling in Asia with JPYstrength found support above 560 technical support and gold pricesrebounded in Europe reaching 562.60 by the morning fix. Later speculative interest took prices to the highs of the day in the afternoon, peaking at 566.50 before falling back and closing at 563.60. More stable overnight trading has seen gold remain in the 560-65 range with the 25bp ECB rate hike expected today supporting EUR against USD.

Silver: Borrowed again yesterday (a common theme these days) silver was supported above 9.74 and reached highs of 9.84 before closing little changed on the day. The market remains long and it seems that no news is still good news as far as the ETF is concerned.

Platinum: Trading in a narrow range between 1,045 and 1,050, the industrial metal continues to find resistance on the upside and support on the downside. Better performances in precious metals and in palladium in particular should continue to support platinum, but the upside progress may be slow without additional consumer buying.

Palladium: Sister metal palladium outperformed yesterday, posting a closeon- close gain of 2.10% against small losses in the other metals. Perhaps optimism over the forthcoming end of Stillwater’s sales helped sentiment. If the positive view is further supported today by headlines in Malaysia over jewellers and carmakers turning to palladium from platinum, the white metal could test further above 300 again.