In February I am interested in following commodities:
Soyoil - reason are the same as last month. At the moment I have no position and waiting for the market to release some heat and jump in again.
Cotton - we witnessed a beautiful rally in cotton during January. CT appreciated by more than 10% for no apparent reason and against common sense - huge crop, big supplies and no solid demand from China. Commercial users are bearish so I suspect that rally won't be a long-one. I opened my first careful shorts.
Heating Oil - price appreciation in the end of January has caught me unprepared and my shorts suffered a heavy blow. I did not expect such a strong move for no apparent reason. Today's price 3.15 does not seem justified in my eyes. I will be keeping it for a couple of weeks to see thing calming down but if not I will close the position because 2nd half of February is the time when HO price hits the bottom and from that movement prices begin a slow uptrend. Current price is close to historical high, so the whole thing look pretty interesting - are new highs on the horizon?
Live Cattle - I opened longs in LC a couple of days ago. Herd population reduced during last months due to drought in the US and last month a big processing facility in the US was announced for closing down and this caused prices tumble. At the same time from historical perspective LC starts bullish trend in February, so maybe are all of the above parts of the same puzzle?
Oats - I bet on price appreciation. Basically I follow the commercials.
Wheat - same as oats I am long Wheat. Drought has not gone away. It is only a matter of time to realize the issue. Also, commercial hedgers are long wheat too.
Orange Juice - I am hunting an entry point for OJ for 2 months already and every time it slips away from me. Commercial users of OJ are bullish and I am waiting for price to relax to make an entrance.
Oil and NatGas - heating season is almost over but driving season is approaching. Oil had a nice run up in Jan and I wonder if there is still some bullish potential. Let us not forget that we live in early post-crisis times. Injections and weather will decide NG faith. I am holding shorts now but I am looking for exits.
Copper, platinum, palladium - all of the above are at overbought levels. All of the above are at level when COT report issues sell signals. But historical cycles of all of the above say "Buy". I wonder who is right.
Coffee - the bear of the year so far. Everything is bad but during last weeks large speculators began to reduce their short positions. What's brewing in the pot?
Feeder Cattle - I do not follow this commodity much but if LC would be a success story why FC should not?
Rice - commercial buyers and bullish but historical price trends for February are bearish. I guess it is not the right time yet. Let us see.
Some of smart people I am used to listen to have changed their stance from ultra-bearish to bearish saying "Well, we've passed the worst part already and things are starting to recover". We have barely licked the wounds, yes, but the system remained the same - governments print money, tensions in the Middle East remain, EU is making tiny progress (while as always is willing to sell it like a big story) and corporations do not hire. We are in the 1Q buying spree - prepare to jump out soon, the number of parachutes is limited.