Dear Friends,
I am putting some part from this week newsletter fr review. I am sure you will enjoy it. Thanks & God Bless
EXCEPT DOLLAR, EVERYTHING ELSE IS IN SPECULATIONS
Dear Members,
Those who have been trading for years must not have experienced the kind of volatility we are witnessing now in the markets. The volatilities are purely driven by speculation and looks very risky. I am sure everyone will agree with us that current time is one of the most risky time to trade. Currencies, metals, soft commodities and grains--all these markets are moving violently, not supported by fundamentals, which do not change so much over the short-term. I won’t recommend any trading at this stage and I am sure many will agree with me, even those who are making money in commodities, who must also be feeling nervous and cautious. It is difficult to predict when markets are at the top but one thing I am sure is that the ending of this bull market in commodities will be a nasty one.
Fed decision was taken against the dollar by most analysts so after Fed decision dollar went down sharply but it recouped some losses on Friday. As an advisor one thing I will recommend very strongly is that you should not go against USD because next move of dollar will be for the next five years, and the move will be none stoppable. This is a great opportunity to buy dollar fearlessly.
I highly recommend that you should not be holding any commodities, and those who like to take advantage of the coming corrections should buy some puts in cotton, sugar, and metals. Grains should be in the buying list on weakness as well. I highly recommend that metal investors stay away from any buying because at this stage they are walking on the path on which oil walked in 2008, and we all know the subsequent freefall trapped many that were singing the "peak oil" songs. At this stage I am scared that gold and silver are trying to do same. Let’s see what this week indicates.
Weekly Newsletter from 8-12 November
GOLD
As I am too much concerned about the current volatility in metals, obviously I am not recommending any buying. Currently metals can keep moving up for a few more days or even few weeks but mark my word that once it start moving down, I am sure no one will be able to stop that fall so please be careful.
This week gold may trade positively for the first two to three days but then there will be sharp corrections from Wednesday onward and then it will fall sharply on Thursday and Friday......
Trading range will be $1,408 to $1,331, which means that gold will have huge corrections.
SILVER
Since last two months silver has been outperforming other metals. Silver will going to........
BASE METALS
This week is not good at all for all base metals from late Tuesday and they can fall more than five percent during this week. Copper, platinum and palladium will move down sharply. Great opportunity to make some money in base metals during this week.
This week Higher/lower side for copper will be $401 to $373, platinum from $1,798 to $1,710 and palladium $700 to $628. From.......
STOCK MARKET
This week all major stock markets will.......
TREASURY BOND
Treasury bonds was unable to move.......
COFFEE/COTTON
Last three months cotton prices have been moving up. Lately it has been moving up with thin volume as so you have to be very careful. This week Mercury move will bring down cotton sharply so it's great time to take some puts......
Coffee prices will.....
SUGAR/COCOA/ORANGE JUICE
Sugar prices have been moving up and it touched multiyear high. Mercury will damage big way so those who shorted sugar can hold their short positions. Those who are planning to take position should use puts. Once again puts are great trades when markets are moving up sharply in one direction because risk is limited. I won’t be surprised if sugar comes back to $21.20 from $31.30.
Orange juice will remain positive during this week, but orange juice will remain in a trading range for the next two months. Avoid trading orange juice for now.
COCOA will remain sideways. I don’t recommend any trade on it.
GRAINS
Last two weeks grains prices remained sideways. This week grains will remain weak. In the short term we see prices coming down in corn and soy.......
I will recommend you to get out from all grains positions this week. I see at least 10 percent correction immediately (in the next two weeks)......
OIL
From late Monday oil will.......
CURRENCIES
What a great time to buy Dollar Index! Last week Friday's move has confirmed that dollar is entering its most amazing trade. One can sell Swiss Franc, Yen, and Euro. In financial market today you have best deal and that is investing in USD. I don’t want to give you any prices range at this point. Just build up long positions in USD or shorts in Euro. USA economy will slowly improve and worst news from Euro will start piling in. Friday USD index closed around 76.69 and expect 79, that 89 and then 100, which today is impossible for most people to believe. This is like the same dream people had when I was talking about gold reaching $1,600 and silver $28 in 2002. I predict because I have astronomic reasons and calculations. Many are now predicting gold to reach $3,000 and even a few are saying $5,000 or $10,000, but I don’t see that happening even in a longer term but overall gold will remain in demand and as we mentioned in 2001-2002 that gold won’t see again $272 for decades, just the same way we don't see dollar trading below current prices for the next five to ten years.
Best trades this week:
BUY DOLLAR
BUY PUTS ON SUGAR, COTTON, AND METALS (ALL EXPIRING MARCH 2011). I am 100% sure you will mint money on these trades.
Six month trade - Buy gold puts (March 2011, $1100 put) and silver (March put of $21, I am sure this prices will fullfil)
SELL OIL AND GRAINS AS WELL.
Thanks & God Bless
Mahendra Sharma, 7 November