Weekly Update: December 31, 2013

| December 31, 2013

Weekly Update: December 31, 2013

 

Commodity Watch:

It’s been a relatively slow trading week for commodities thanks to the Christmas holiday.  The lack of investor participation has most markets trading in a lackluster fashion.

But there is an interesting development in the gold market…

Gold

As you can see, the yellow metal is still flirting with the highly important $1,200 an ounce technical support level.  Unless a catalyst develops to push gold up from this price area soon, there’s a growing chance of the metal breaking down to the mid-$1,100s.

As a result, let’s keep holding our iShares Comex Gold Trust (IAU) January 2014 $12.00 Puts for a big downdraft in gold.

Let’s take a look at our remaining open positions…

 

Portfolio Recap:

. . . . US Natural Gas Fund (UNG) January 2014 $22.00 Calls

As you know, it has been a remarkable ride for natural gas over the past month.  A stubborn US cold spell sent natural gas soaring to multi-month highs at $4.50 mmBtu.

And judging by the NOAA’s most recent forecast, the cold looks like it will stick around for a while.  In fact, the NOAA’s most recent 6-10 day outlook once-again has temperatures staying below normal for a vast majority of the country. 

That means heating demand and EIA inventory withdrawals will likely be robust for the foreseeable future…

Keep holding our UNG calls for higher prices!

 

Category: Commodity Trading