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Thread: when will commodities turn?

  1. #11

    Join Date
    Dec 2007
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    Default Re: when will commodities turn?

    UGA looks interesting. It appears primed for a pullback if you look at the exponential moving averages, and the PMO (momentum indicator), but the simple moving averages are showing good technical setup.

    It's trading above both the 20 and 50 DMA (simple) and the 20 DMA is above the 50 DMA.

    It trades below the 50-day EMA and the 20-day EMA is below the 50-day EMA.

    -- Tom | My Trades

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  3. #12

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    Default Re: when will commodities turn?

    Quote Originally Posted by Bullitt View Post
    Sorry for my ignorance, but is Nenner any good? His website doesn't give much more than mainstream TV interviews. No track record, no recommendations or newsletter sample. I saw him once on Bloomberg and he was very calm but firm in his belief.
    Follow up on Charles Nenner prediction. On Feb 3 he said, the long-term market cycle will be "bottoming in a couple of weeks", and rally into mid-March (March 9 to be exact).

    His short-term cycle suggested the market would bottom in a couple of days [from Feb 3], which did not happen. Here it is Feb 20. His credibility is on the line if we don't see something soon...

    http://charlesnenner.com/inc_files/2009-02-03-cn-cnbc.wmv
    -- Tom | My Trades

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  5. #13
    alevin Guest
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    Default Re: when will commodities turn?

    Quote Originally Posted by Bullitt View Post
    Commodities have already turned. Take a look at OIH and the relative strength it's been producing. Logic would say USO should turn soon also, but right now UGA is trending steady above it's 50 DMA. Maybe a good entry into UGA would be a pullback on it's 50 DMA. As long as XOM stays above 74 and CVX stays aove 67.50, OIH should continue to outperform.

    You have to figure, there are millions of barrels of oil in these offshore tankers ready to flood the market on any uptick and as long as contango stays in effect, these tankers can slowly hit the oil market with a supply on the sell side. Gasoline can only be produced at a constant rate due to the restriction on refineries in the US. Most refineries and oil platforms that got wasted in Katrina are back online by now, but our refineries still can't keep up with demand.

    So, while USO tends to get the most press and has a higher volume than UGA, it may be more worthwhile to trade (or hop on a trend trade) with UGA than USO.

    Any thoughts?
    Hi Bullitt, I told Lady the other day I've been looking hard at USO. Trying to winnow down ETF choices for a very small trading account like mine is tough so I'm being pretty conservative. Expense ratios count for me. USO exp. ratio is 0.5% vs. UGA exp. ratio of 0.6%.

    USO is also trading at a better discount than UGA is for the moment. Discount status and level are one of my selection criteria too.

    Another criterion for me is average daily trading value. SeekingAlpha had an article in early January when they listed 139 ETFs due to die, older than 6 months in existance, with average daily trading value of <$100,000-with more ETFs due to die shortly. Maybe UGA doesn't fit that category, I don't know, but when I look at daily shares traded, there's a big fat No Data sitting there-info from etfconnect. Red Flag for me. As Malyla says "watch your tail". JMO, I'm considering putting my first ever toe in the ETF pool next week with USO.

    http://www.etfconnect.com/select/fun...sp?MFID=184932

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  7. #14

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    Default Re: when will commodities turn?

    Quote Originally Posted by alevin View Post
    I'm considering putting my first ever toe in the ETF pool next week with USO.
    Good for you alevin and good luck! An ETF virgin... no longer.
    -- Tom | My Trades

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  9. #15

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    Default Re: when will commodities turn?

    I'll be watching USO myself, it might make for a good trade, if I can time it right.
    Candlestick crack addict...

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  11. #16
    alevin Guest
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    Default Re: when will commodities turn?

    Uhh, being detail-oriented as I am, I've continued to research my oil ETF ideas through the weekend. I've got seriously contradictory information in my head right now, which means I'm gonna hold off on USO until things get a little clearer. And of course that means I'm thinking stronger possibility things will get a bit more bearish than bullish in the near-term. I'll expound on those bits of info over on the Everything Oil thread I just found this morning. Drat, still an ETFV.

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  13. #17

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    Default Re: when will commodities turn?

    ETFV - love it
    -- Tom | My Trades

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  15. #18

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    Default Re: when will commodities turn?

    Quote Originally Posted by alevin View Post
    Trying to winnow down ETF choices for a very small trading account like mine is tough so I'm being pretty conservative. Expense ratios count for me. USO exp. ratio is 0.5% vs. UGA exp. ratio of 0.6%.
    I wouldn't worry too much about expense ratios unless you plan on buy and hold. (Not a good idea with a commodity ETF). Discount status is a tough one on ETF's because of institutional arbitrage. There are firms who figure the exact price of an ETF and trade it based only off the the discrepancies in NAV. I'd just be weary of an ETF trading at a significant premium to NAV, such as anything over 1%.

    There's pros and cons to low volume, and I'm sure you know the cons already. However, we're small fries and probably aren't buying much more than 100 per order anyway. Sometimes we might be buying 50 shares of an ETF because of course, we never buy all at once. (I wish I could take my own advice sometimes.) I've put in orders especially on days the market has been hammered, that got filled at a better price than my limit because it was a low volume ETF and other folks were most likely panicked out. You can't get away with that in USO.

    UGA may be turning though and UGA won't be able to continue rising without USO pulling up behind it.
    "Don't let your highs get too high and don't let your lows get too low." Bullitt’s Market Blog


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  17. #19

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    Default Re: when will commodities turn?

    Quote Originally Posted by etftalk View Post
    Follow up on Charles Nenner prediction. On Feb 3 he said, the long-term market cycle will be "bottoming in a couple of weeks", and rally into mid-March (March 9 to be exact).

    His short-term cycle suggested the market would bottom in a couple of days [from Feb 3], which did not happen. Here it is Feb 20. His credibility is on the line if we don't see something soon...

    http://charlesnenner.com/inc_files/2...03-cn-cnbc.wmv
    Follow up on Nenner's prediction.

    He did say the S&P 500 could hit 1000 on this rally, which was close. But he also said the rally would start in Mid_february and END on March 9th. It was just getting started on Match 9.

    He claimed victory the other day on CNBC, despite being way off with the timing.

    http://www.cnbc.com/id/15840232?video=1155616343&play=1
    -- Tom | My Trades

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  19. #20
    alevin Guest
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    Default Re: when will commodities turn?

    That's one of the reasons I don't try to frontrun things, better to be a trend follower/momentum player-end up looking silly for getting caught flatfooted out of the market on the 90% updays instead.

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