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A Fifty Year Spread Between Stocks & Commodities.


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Jerry Welch, Commodity Insite!
Call me at 406 -682 -5010
Ennis, Montana 59729

Follow me on twitter@commodityinsite

Early in the session I sent the following Special Email Alert to those that subscribe to my twice a day newsletter, Commodity Insite and brokerage clients. Note the time sent.

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The range for February cattle today is $126.77 to $126.02 with a last of $126.15. I was hoping February cattle could rise to $127.00 to $128.00 and that certainly remains a possibility. But if the market drops below $125.75, if could take a hard, hit and not move into my sell zone.


Selling the market day with stops at the high seems low in risk. Keep selling rallies and bear spreading the market. And watch closely the $125.75 level if it is taken out to the downside.

Also keep selling hogs.


The time is 9:30 a.m. Chicago

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The last for February cattle is $124.97 compared to $126.15 when I broadcast the Email Alert above. And the low for February cattle is $123.60. Based on the performance of the cattle futures today, it seems likely that moving forward, rallies will be sold rather than rallies bought. But as always, only time will tell if that scenario unfolds.

Also note that boxed beef prices slipped $.94 this morning and there may be further weakness later today when the final tally is announced. Plus, the daily kill should be larger than expectations. Thus, if boxes weaken further amid a larger kill, more downward pressure on cattle futures could easily be seen.


Adding salt to the wound for cattle and all other hard assets is the nearly 168 point break being seen with the CRB Index coupled with a 1 full point sell-off with bonds. In other words, rates are rising and commodities per se are falling. Thus, with stocks are a new all time high, the spread difference between stocks and commodities is into a new 50 year low in favor of stocks.

The time is 12:55 p.m. Chicago




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The risk of loss in trading futures and/or options is substantial and each investor and/or trader must consider whether this is a suitable investment. Past performance, whether actual or indicated by simulated historical tests of strategies, is not indicative of future results. Trading advice is based on information taken from trades and statistical services and other sources that Midwest Market Solutions believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice.There is no guarantee that the advice we give will result in profitable trades.





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About the author


Jerry Welch has been in the futures industry since the late 1970's and is a true veteran of the markets. He has been quoted often in Wall Street Journal and is author of Commodity Insite, one of the longest commodity futures newspaper columns in history. His weekly column has been published each week since the mid 1980's and is one of the most recognized names in the world of commodities.

Mr. Welch is also known widely as a, "so so" flyfisherman.  

His column is published by the Illinois Agri News in La Salle, Illinois, Cattle Today, in Fayette, Alabama as well as Consensus, in Kansas City, Kansas.

He can be contacted at 406.682.5010 for a view of his, "twice a day" market column that includes price forecasts and trading suggestions.

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