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Al Abaroa brings over fifteen years trading experience. He is the author of Options Pro Essentials (Futures Press 2008), The Commodity Wire - A Market Weekly, The Options Pro Report and Senior Strategist at Options Pro, Corp. He has appeared on CNBC and BNN with analysis of the futures markets... More
My company:
Options Pro, Corp.
My blog:
The Commodity Wire
My book:
Options Pro Essentials
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  • Options Pro - Weekly Report - Gold - Al Abaroa

    Metals: Bombs and QE2 were the driving force in Gold’s rise this week, helping the metal close out its third straight month higher. Friday’s bomb incidents, across multiple international airports, rekindled fear in investors and helped support the metal. It is interesting to see how much more mature the markets are becoming to terrorist threats. While past performance is not necessarily indicative of future results, we hardly had a sell-off in equities or a spike in gold on the news. What seemed to really influence the yellow metal’s rally of over 3% month-over-month, were inflationary concerns brewing from QE2 flows. The consensus of $1-$2 trillion in assets purchases has prompted some to take refuge in the metal as a possible safe-haven. The fear here is that CPI will rise as a result of other commodity markets moving in anticipation of the flow. Remember, the Consumer Price Index (core inflation figure) is reported without food and energy being taken into account. So, while the inflation figures remain muted, they are underscored by industrial commodities’ advance. However, once initial QE2 flows are determined, if any, I think gold’s direction will have a more clear picture. Case in point, it was reported that the first tranche of QE2 flow will be in the neighborhood of $500 million. This is significantly lower than the $1 trillion charge out of the gate with QE1. Gold fell in price on this news, and if it turns out to be true it may decline even further.

    This theory may be supported in the chart. Looking at the Elliot wave pattern, the initial fall off of the all-time high came in 5 waves, not 3. In my opinion, this implies that the initial move was not corrective, but rather impulsive (trending). To me, this could mean that the 3 wave move up from $1,315.80 was corrective and suggests a lower trending market. Key support now rests at $1,315.80 and if Friday’s high was the short-term top, then I would target a move down to $1,287.20. Stay tuned.


    Questions or Comments?  Please email: al.abaroa@optionspro.com

     

    About Us: Options Pro is in Plantation, Florida. Clients are provided with individualized technical and fundamental information. We believe no two investors are alike. Our firm prides itself on client care. If you are new to the markets or a seasoned trader, we invite you to take a close look at our commitment to excellence.

     

    Trading futures and options involves substantial risk of loss and is not suitable for all investors. All known news and events have already been factored into the market's underlying commodities. Past performance is not necessarily indicative of future results.

     

     

    Read Full Article



    Disclosure: No Positions
    Tags: GOLD, Al Abaroa
    Nov 01 10:07 AM | Link | Comment!
  • Options Pro Report - Market Report - Energies- Al Abaroa

    Energies: Implied volatility on oil’s options has fallen approximately 3 percentage points over the last few weeks as its statistical counterpart has slipped to the 25% level. While past performance is not necessarily indicative of future results, the slip in volatility followed oil’s price reaching two peaks in the last 12 months. Price action has been choppy throughout the month of October as it seems traders have been reluctant to commit ahead of the elections and FOMC announcement. I’m sure the employment figure being released this Friday is adding to the hesitation.

    Technically, the October high of 85.08 nearly matched a 100% Fibonacci extension (85.29) of the May low (71.50) to the August high (84.45), as measured from the August low (72.34). I believe this may mark a completion of an ABC correction and the downtrend may resume. However, if event risk warrants bullish price action and the 85.08-85.33 level is breached, a move up to 87.07-87.33 may occur. Remember that the 87 level served as key resistance in Q4 of ’09. Bears will not want to see oil trade above this price as it may open the door to higher ground. What they will want to see is a break below the Sept 14, 2010 high of 79.75, which could drop price back into the mid $70 range.

    Questions or Comments?  Please email: al.abaroa@optionspro.com

     

    About Us: Options Pro is in Plantation, Florida. Clients are provided with individualized technical and fundamental information. We believe no two investors are alike. Our firm prides itself on client care. If you are new to the markets or a seasoned trader, we invite you to take a close look at our commitment to excellence.

     

    Trading futures and options involves substantial risk of loss and is not suitable for all investors. All known news and events have already been factored into the market's underlying commodities. Past performance is not necessarily indicative of future results.

     

     

    Read Full Article




    Disclosure: No Positions
    Tags: Al Abaroa
    Nov 01 10:06 AM | Link | Comment!
  • Options Pro Report - Weekly Report - Foods and Fibers - Al Abaroa

    Foods and Fibers: Winter Wheat ratings gave promise to the bulls and allowed wheat to move to the top of the leader board. The much needed fundamental news gave the bulls the push they needed to break above the key resistance of $7.57, the October 13, 2010 high. The next target for March futures will be $7.82 and then $8.31-4. Looking at wheat versus the dollar, its 50 day correlation study (NYSE:DCS) is currently at 23.46%, and the 100 DCS is -71.57%. The short-term fundamentals have supported wheat’s price as the greenback fell, thus prompting the 50 DCS to move to a non-correlated status. The question to ask and watch for is; will the fundamentals remain strong enough to battle off any dollar based rallies?

    Questions or Comments?  Please email: al.abaroa@optionspro.com

     

    About Us: Options Pro is in Plantation, Florida. Clients are provided with individualized technical and fundamental information. We believe no two investors are alike. Our firm prides itself on client care. If you are new to the markets or a seasoned trader, we invite you to take a close look at our commitment to excellence.

     

    Trading futures and options involves substantial risk of loss and is not suitable for all investors. All known news and events have already been factored into the market's underlying commodities. Past performance is not necessarily indicative of future results.



    Disclosure: No Positions
    Tags: Al Abaroa
    Nov 01 10:05 AM | Link | Comment!
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