Today, I want to take a look at things that might be shaping up this week for you as opportunities near term and some that may give new entry opportunities for longer term plays as well. This week I will be keeping an eye on Currency, Crude Oil, Cattle, and Corn.
Here are my thoughts:
Japanese Yen: I have been a huge proponent of Japanese Yen weakness and needless to say, the last number of weeks has made me very happy. This week however, I would keep a close eye on the Japanese Yen as in my view; it seems a little overextended in its weakness. The Daily chart for March 2013 contracts illustrates my point.
Be aware of the potential for the Yen to gain a bit of strength back near term. If you are currently in an options trade on the Yen with us, please speak with your broker about your position to find out whether or not it is an appropriate time for you to protect profits if you have them.
From a fundamental perspective, the BOJ Easing topic will probably continue to keep JPY weakness on the board as a longer term trend. However, for this week, I would remain cautious and be prepared for a little retracement to come our way.
Great British Pound: My view on the Pound is a bit mixed. Personally, I feel that there is quite a bit of room for this currency to gain and the Weekly chart for the British Pound March 2013 contracts tends to be lending itself to a bit of a bullish nature.
The rough spot resistance point at the moment sits in the ballpark of the 1.63 territory. Now, that is not the number to beat for a truly long term break out, but it is a level that we need to keep an eye on. Keep in mind that some years back, the GBP high against the USD was around the 2.11 territory. Think for a moment, just how much ground it has given up, and as well, how much opportunity there might be to make some of that up in the future. The ascending triangle being built here on the Weekly chart could very easily allow a run at and potentially through that 1.63 resistance. In addition, the Pound has fallen a bit in recent days which may provide us with a better opportunity for long side plays.
The larger picture, longer term, caution flag to the bullish potential of the Pound is going to be the Monthly chart, which illustrates an inverse pennant.
Should the British Pound lose enough ground to cause the Monthly formation to come through to the short side, then any bullish positions could quickly be wiped out. Keep in mind when evaluating the British Pound that the duration of the trade you intend should be planned before opening any new positions. Be aware that shorter term opportunities and longer term trend potential may be at odds. Both may provide opportunity for you, but you need to pay close attention to this currency as it can be a really big mover in a very short period of time.
The Pound is definitely one to watch as it has explosive potential. The only question left will have to be answered by the markets “Which direction goes bigger faster?”
Crude Oil has been on a bit of an upward swing of late, which is great for the bulls in that market. February 2013 contracts Daily Chart shows you the progress that has been made over the last few weeks.
This week, I would be keeping watch on retracement capabilities for Crude. The daily charts should allow a little weakness this week in order to keep a “healthy” perspective. I personally still remain fundamentally bullish Crude for the long haul. Watch my video on the www.rmbgroup.com home page to learn how you can play Crude Oil going long into 2015.
Shorter term plays may include short side opportunities this week, but I would favor Crude Oil bulls using this opportunity to manage any currently open positions and prep for the potential to initiate a new trade or add to an existing position should a dip occur and new entry signals to the long side show up.
Feeder Cattle, specifically, took a hit over the last few days and this week I would be watching for an upswing.
Keep watch to see whether or not 151/150 continues to hold as support. Shorter term “Bullish” opportunities may present this week.
This type of upward momentum would fall in line with what has been the greater overall trend thus far via the Weekly and Monthly charts seen below:
Near term, towards the beginning of this week, I would look to see Corn fail a little bit. Looking at the strength that has occurred in the last week or so, the Daily chart would be assisted by allowing a very near term limited failure.
Should this failure occur however, I would be watching to look for new buying power to come into the market place. Corn has some interesting patterns which may deliver Bull Flags on the Weekly and Monthly charts that could easily keep this market bullish.
In the world that lives through Commodities and Futures daily, these markets are much more than what you need to survive. They are what you can utilize to thrive.
Currency, Crude, Cattle, and Corn are some of the markets to watch this week. For more information or for daily assistance with the Options market on Commodities and Futures, visit www.rmbgroup.com or click here to get started today.
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