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What will Santa Bring?

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It has been a quiet week but consistent with the bullish action. The S+P is now up 7 days in a row and will sell off in the next couple of days. However, the rally overall should continue and more new highs as Santa is delivering another Christmas rally.

Since the announcement of the Impeachment of President Trump all markets have worked higher. The markets know this is a political move which never plays well in markets. Although we were given coal last year for Christmas Santa is delivering joy in all markets which we expect to continue.

Grains all have pulled back from their explosive rallies but have all held support. Wheat has already made new highs; we expect Corn and Beans to follow. Volume has started to pick up and the key bottoms held which leads us to believe the rally has just begun.

Meats are acting exactly as scripted with Hogs finally closing above the key 70 level. There is no reason to believe meats don’t have a lot more room to run on the upside. All signs point to higher prices and we plan to ride the wave.

The Dollar rallied back into congestion after breaking down last week, we expect this rally to fail. Gold continues to flirt with bullish action but remains bearish, looking for a close over 1490 February Futures. Crude continues to explode higher and should test the highs from the Saudi Arabia Drone bombing.

The Bottom Line: The action is solid across the board, there is no reason to expect that to change. Notice we made very little adjustment to the charts from last week indicating they are tracking to our patterns. We expect the bullish moves to continue.

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CORN - As we wrote on Saturday, Corn was going to change and be long. We bought Sunday night and are now looking for a big rally. Although the next two weeks are holiday's we don't expect any major movement. If there is a big move, we believe it will be higher. We are long with the algorithm

Hedge Recommendation: Hedged and Selling Weekly Iron Condors

Position: Long 50% - Will add at 385

BEANS - Have had a great "V" shaped recovery and look to be going higher. The late selling this week was expected and Beans could be headed to new highs. As we roll to March Beans look great along with the pattern. The algorithms are long as are we.

Hedge Recommendation: Hedged and Selling weekly Iron Condors

Position: Long 50% - 9.30 March - needs to hold

WHEAT - We saw new highs and sold half of our position on the way up. We are now looking for another spot to buy again. The big rally naturally brings a little pullback. The rally should continue, and We expect a run at new highs, we are long with the algorithm

Hedge Recommendation: Hedged and Selling Weekly Put Spreads

Position: Long 100% - Will add at 540

DOLLAR - After breaking down the Dollar has rallied back into congestion. Based on the algorithm we will assume this is a selling opportunity, especially with all of the FED manipulation. There is a big move coming which we expect to be lower. The algorithms turned short as did we.

Hedge Recommendation: Hedge dollars against cost

Position: Short 100% - Added at 97.30

CRUDE - There is no stopping Crude at this point, every sell off is met with buyers. We will be looking for a test of the Saudi Arabia Drone. bombing highs. Long term we are bearish, but our mechanical method is bullish, and we will continue to play the algorithms. They are long as are we

Hedge Recommendation: No Hedge

Position: Long 50% - Staying long, not adding

S+P - Broke out to the upside and all signs point to the rally continuing. There is no doubt that this could continue for an extended period of time. There is more volume which could accelerate the action, but the dull market rally should continue. We believe the next big move with volatility will be lower, but the rally could continue for a long time. We are long with the Algorithm

Hedge Recommendation: Portfolios should be Hedged

Position: Long 50% - Holding

GOLD - Keeps showing some bullish activity but can't seem to break out. This appears to be a great selling opportunity. Gold could breakout to the upside buy until there is a close above 1490, we will stay short. We are short with the algorithm.

Hedge Recommendation: None

Position: Short 200% - Will cover half at 1470

FEEDERS - The big blow off we saw last week was met with some selling pressure as expected. The pattern looks solid and the rally should resume any day. With the holidays we could see a lack of interest, but big moves should be higher. We are long with the Algorithm

Hedge Recommendation: Hedged

Position: Long 50% - Will add at 144

FATS - Like Feeders, Fats pulled back a little but not far enough for us to add. We are looking for 130 and possibly higher, expecting the rally to continue. Only the holiday trade will slow this market down. Algorithm long as are we.

Hedge Recommendation: Hedged

Position: Long 150% - Will add at 124

HOGS - Finally closed above 70 basis February. We assume the algorithms will turn tonight and will let you know in the morning. We are now looking for an extended rally to 75 as our next level. The action is good, and we are expecting to get long tomorrow. Algorithms are short

Hedge Recommendation: Hedged

Position: Short 100% - Bottoming action



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