While the long awaited decline in oil prices may or may not be here, it certainly has my attention. after getting in long around 69 '09 and short 71. it has been a very straight up move. Yes I would have definitely made more if I had the straight call, but hind sight is always 100%.
Gold has come back, oil, much of the natural resources, yet grains moved up today.
So our long gold position made back in Nov of last year is once again back in the money on the options. I have more than doubled my money on this trade, so don't tell me calendars don't work....I digress.
We are looking for the banking sector to become very weak and the feds having no choice to raise rates. This leaves bonds in terrible shape going forward. CD's will lose out since the rates are locked in as they raise, the best way for a secure way to trade this is money markets. Try to get treasury ones if you can.
So we are still short bonds, long natural resources ( you have a better buying opportunity now) long grains and short the dollar (which we are getting killed on)
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2 comments:
Hi Dell,
I think the weak Dollar days are numbered, especially now with the talk about raising interest rates. Therefore oil should make its way back down.
What is your take on Washington Mutual? It seems very cheap now. Would you consider seling Puts on it?
While I am taking a bath on the dollar for now, I still expect it to be weak. All the jawboning from Ben is not changing what they are really doing.
Money supply is out of control. That is why everything is going up in price.
But we are global now and I think demand is far outstriping the supply. These bumps are expected, the trend is still intact. How much weaker will the dollar get is anyones guess. Raising rates is only one factor. Will be interesting to see.
Washington Mutual is in bad shape. Selling puts if you can get .50 on the 5 strike seems like a good play for 38 days. However this is one stock I would not want to own for long.
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