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11-2-0-2017: Milk Is Well-Supplied

As we read the news on milk, concerns are mostly normal. Farmers worry about government programs, The supply of milk around the world seems "adequate" and prices have been heading lower. But numnbers of dairy farms, cows, etc., are on the decline. Government programs also offer stability to the milk market. Milk is very cyclical. This is so much so that futures contracts expiring each month have quantum jump distances between where one left off the the farther out contract now becomes the forward one. These produce gaps on a chart. All of this suggests that when milk gets oversold, it will bounce back and when it gets overbought, it will adjust downward.

But currently, milk is oversold and still heading lower. We cannot find convincing reasons in the news and would normally expect milk prices to turn around and head back up at this point. But the extent to which milk prices have declined suggests there is more going on than we realize. The best we can do is toi stick with a system. Technically speaking, milk looks weak.

Our recent article on Milk is in the Archives Section below.

11-17-2017: Some Commodities We Haven't Currently Reviewed

How do we pick a commodity for review? Here are technical strength or weakness ratings for 11/17 on the other major commodities not being currently being reviewed or traded on this site. To pick the commodity for our next review, Zenith will usually refer to such a list and pick the commodity which has one of either positive highest or negative lowest scores. Commodities currently under review on our list of about 18 on this site are not shown below. It's just a way of keeping track of what else is going with other commodities.

Dec  NASDAQ 100 Index     88
Dec  Silver               72
Dec  Gold                 48
Jan  Platinum             40
Jan  Gasoline             40
Jan  Soybeans             40
Jan  Rough Rice           16
Dec  Hi-Grade Copper      16
Dec  Euro Currency        16
Dec  U.S. Dollar Index    -8
Dec  Treasury Bonds        8
Dec  Soybean Meal          8
Dec  Live Cattle           8
Dec  Oats                  0
_________________________

Nov  Milk Cl III        -100
Dec  Australian Dollar   -96
Mar  Eurodollars         -88
Dec  Treasury Notes      -72
Dec  Chicago Wheat       -64
Dec  Coffee "C"          -64
Dec  Canadian Dollar     -40
Jan  Natural Gas         -40
Dec  Swiss Franc         -16


Previous ratings (11/14).... Dec NASDAQ 100 Index 88 Dec Oats 80 Jan Gasoline 40 Dec Live Cattle 16 Dec Silver 8 Dec U.S. Dollar Index 0 Dec Euro Currency 0 ___________________________ Dec Corn -100 Dec Australian Dollar -96 Jan Rough Rice -88 Mar Eurodollars -80 Dec Chicago Wheat -56 Dec Coffee "C" -56 Jan Platinum -56 Nov Milk Cl III -40 Dec Canadian Dollar -40 Dec Gold -40 Dec Treasury Bonds -32 Jan Soybeans -32 Dec Swiss Franc -16 Dec Soybean Meal -16 Dec Hi-Grade Copper -16

The ratings are good only for date shown, and rapidly change each day, whereas we review the list only periodically. Once a commodity appears on our list of articles and is being currently traded, we consider its long-term direction has been established and trade consistently from that direction wtihout worrying about day-to-day changes. Granted, that's not how most other futures traders work nor how we trade stocks; but we have found it to be effective for commodities to trade that way.

Archive List

11-20-2017: December Milk: News Mainly Cyclical

11-16-2017: December Corn: Oversupply and Slow Exports

11-13-2017: January Orange Juice: Re-evaluating Hurricane Damage

11-09-2017: December Kansas Wheat: Weather to the Rescue

10-27-2017: January Feeder Cattle: Anticipation of Inflation

10-23-2017: December Cotton: Hurricane Damage Overstated

10-18-2017: December Crude Oil: Reacting to Temporary Factors

10-12-2017: November Ethanol: Environmental Protection DIminishes in U.S.

10-05-2017: December Cocoa: Cost of Production Rises

09-29-2017: March World Sugar: Brazil Floods Market

09-25-2017: November Heating Oil: Hurricane Effects

09-22-2017: December S&P 500 Index: Fed To Begin Rebalancing Its Portfolio

09-18-2017: December British Pound: Monetary Policy Meeting Hawkish

09-13-2017: December Japanese Yen: North Korean Threats Abate

09-09-2017: November Lumber: Anticipation of High Tariffs on Canadian Softwood

09-05-2017: December Lean Hogs: Over-Reaction to Herd Size and Slaugher Facilities Increase

08-29-2017: December Soybean OIl: Resists Other Falling Grain Products

08-24-2017: December Palladium: Supply Deficit

08-19-2017: September Mexican Peso: Bluster and No Change

Performance

Updated once a week (usually on Saturdays) unless the preceding week had less than five trading days.
Buy and sell prices are averaged where multiple contracts are involved, which is why they may not fall on an exchange tick increment.

All Commodities Trades 10/02/2017 - 11/18/2017:

 # Commodity           BS    Buy   Sell   Last    Gain Intended  Rough   Group
                                                 (Loss)    Risk Percent

 4 Dec Ethanol          C 139.00 149.00 141.50 $ 11,480  14,848  16.8% Energies
19 Dec Soybean Oil      C  34.15  34.82  34.44 $  7,068  14,934  16.8% Grains  
 6 Dec British Pound    C 131.05 132.18 132.28 $  4,058  14,963  16.9% Currency
 7 Dec Cocoa            L  20.90         21.26 $  2,310  14,980  16.9% Softs   
 5 Jan Crude Oil        C  55.22  57.14  56.71 $  9,450  14,950  16.8% Energies
16 Dec Corn             C 337.60 342.60 343.00 $  3,520  14,880  16.8% Grains  
 4 Dec Cotton #2        S         69.80  69.78 $    -80  14,980   5.6% Cotton  
 4 Jan Feeder Cattle    L 151.96        151.73 $   -580  14,980  10.1% Meats   
10 Dec Lean Hogs        C  62.87  59.90  60.65 $-12,180  11,880  10.1% Meats   
 3 Jan Heating Oil #2   C 189.50 194.80 194.90 $  6,588  14,994  16.8% Energies
 5 Dec Japanese Yen     S         89.08  89.29 $ -1,463  14,938  16.9% Currency
 7 Dec Kansas Wheat     C 418.10 430.80 422.00 $  4,235  14,980  16.8% Grains  
 4 Jan Lumber           L 441.50        439.70 $   -912  14,960   5.6% Lumber  
 7 Jan Orange Juice     L 158.33        166.80 $  8,684  14,994  16.9% Softs   
 1 Dec Palladium        C  97.71 101.91  99.29 $  4,170  15,000   5.6% Prec Met
 9 Dec Mexican Peso 500 C 515.20 524.30 525.80 $  3,825  14,985  16.9% Currency
 8 Mar Sugar #11 World  S         15.40  15.37 $     29  14,874  16.9% Softs   
 3 Dec S & P 500 E-Mini C 256.69 257.86 257.63 $  1,665  14,985   5.6% Stock Id

            Adjustment for Open Positions: -($    7,988)
Prior to 11/13:
Other Gains/-Losses This Reporting Period:   $  340,543 ***
 *** For Contracts Closed or Rolled Forward  __________
 
Total for all Trades:                        $  384,422

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Trading in commodities involves substantial risk and past performance is no guarantee of future profits.  Zenith does not sell advice nor does it manage discretionary accounts other than its own. Readers should be aware of the vested interest that all traders/brokers have in encouraging other traders to make the same transactions.  No one should follow investment advice blindly.  This web site should be used only as a "sounding board" for confirming one's own opinion.  Any suggested order placements should be reviewed and reset to fit current market conditions by individual traders.

Recommendations may include trades which have already been made on the same or a previous day, otherwise the issue is placed on a "watch list." Suggested trades are based upon an approximate maximum $15,000 capitalization requirement per trade, depending upon initial contract margin requirements.  Zenith's actual trades may be larger.  $22 per round turn for futures is deducted from profit figures.   Commodity option trade recommendations are not tracked, but performance should parallel that of the underlying commodity's.

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