|
Main Page
| Philosophy
| Current
Recommendations | Newsletter Archives
Contact Us
Research and recommendations by Bill Rhyne
For more info or consultation…
Landline 770-425-7241
Cell 770-366-3070
January 22, 2026
Telling it like it is…or was…
Thanks mostly to
the Cattle markets, 2025 was the worst year I’ve ever experienced in this
business. My short opinion just ate me alive (and some of
you too) as they soared higher and higher, and then worst of all, when an
80 cent (20%, or $40,000 per futures contract) break in Feeders finally
happened over a 7 week period during October and November, I DID NOT TAKE
THE PROFITS OFF THE TABLE…and subsequently watched all that money disappear
into more losses as Cattle rallied straight back up, 60 cents in Feeders,
right into last week, which was just dumb as SHIT. I mean, it’s one thing to be wrong
about the markets, as that IS an unavoidable aspect of trading. But to have
a LOT of money in hand, and then let all of it
basically evaporate is just STUPID…and that is what I was.
Nevertheless, after 45 years in this chair, I do know
that having been wrong does not mean that I will continue to
be so…And the fact is, throughout my career, after the markets have left me
being just dead, dead wrong, has often been when I’ve come up with some of
my very biggest trades. Obviously, there’s no way to know if it will hold
true again, but after substantial “self-flagellation” and research, what
follows are some big picture 2026 observations as
well as recommendations in specific markets that I view as having major
profit potential during the next 3-6 months. I’d also note that I have
definitely not closed my own account J…and that if I recommend
something, I am in it with my own money as well.
THE BIG PICTURE
Sell What’s Hot
Buy What’s Not…
Having been in this business since 1980, I have traded
through more bearish crises and bullish euphoria’s than I can count…which
allows me to feel comfortable in saying that these decades of hard core
experience have provided me with a unique perspective regarding THE NATURE
OF THIS INVESTING GAME...And right
now MY
OBSERVATION IS THAT THERE IS MORE RAMPANT SPECULATION…AND
EVERYTHING-IS-BULLISH FERVOR…THAN I HAVE EVER SEEN IN THE MARKETS. For real, I cannot think of a time…not
even the Dotcom bubble…that even comes close.
You know all the “Top Hits”…AI, Chat GBT, Chips, Robots,
Crypto, Precious Metals, the Mag 7, etc.…Just take your pick of any of
them, or buy them all, and by the media’s reckoning, you’re bound to do
nothing but make money…I mean really…With all of them SO hot, and being
touted via bullish headlines every day, YOU KNOW THAT NEARLY 100% OF THE
INVESTING PUBLIC IS ALREADY IN THESE UNANIMOUS WALL STREET
FAVORITES for as much as they can stand…to the extent that I’d guess
there’s really “nobody” left to buy them…And if that is the case, I
am telling you, what comes next will not be pretty.
This might sound like ancient history…but maybe you’ve
heard of the “Nifty 50,” or the 50 stocks back in the early 70’s that the
brokerage firms were touting as THE 50 companies every investor HAD to have
in their portfolio, the idea being that buying these 50 stocks, at the
Dow’s all time high (then), represented an almost “can’t miss” approach to
investing in the market…Long story short…Wall Street was wrong…The
market topped in December 1972, and went down 46% during the next 20
months, taking the public’s money with it…who probably lost MORE
than that 46%.
So what’s the point?
I firmly believe that today’s “Magnificent 7” is
the “Nifty 50” of the 1970’s, and that, in spite of all of those companies
certainly making tons of money, I’d suggest that every great thing about
their businesses has been 300% priced into their stock “values” by now, and
that the next thing we’re going to see is a major decline. I would
also note, and think you would agree, that the news regarding the
profitability of the Mag 7 for the past 4-5 months has been ongoingly white
hot…BUT…look at what has quietly been happening:
Nvidia -14% decline from its high. At the same price it
was back in August.
Meta – 23% decline from its high.
Amazon – 9% decline from its high. Same price as last
August.
Google – The one exception…At new highs
Tesla – 13% decline from its high. Same price as last
September.
Apple – 13% decline from its high. Same price as
September
Microsoft – 17% decline from its high. Same price as
last June.
Ok…According to New York’s shills, owning all of these
is supposed to be a layup, but quite honestly, 6 of the 7 (and a number of
other major names) look to me like they are either rolling over and/or have
started protracted declines. And yeah, Wall Street will describe what is
happening as “just a rotation,” but I have heard that story before…And when
I see these LEADERS absolutely NOT leading, and put this together with
what, again, I
can only describe as an atmosphere of RAMPANT SPECULATION, every trading
instinct I have says, “GET SHORT!”, or at a minimum, to
sure as hell not be believing the brokerage house “logic” that these very
real declines are “pullbacks,” or opportunities to buy more. NO WAY.
The truth is, I think it is quite possible that we
maybe have reached one of those NORMAL historical periods where the stock
market doesn’t just go up, up and away year after year, but instead does
something like it has done on four occasions during the past century or
so…that being, trading relatively sideways for 10-20 years…putting
together a series of bull and bear markets that DON’T…in this
INVESTING-IN-PIECES-OF-PAPER GAME…allow everybody to just sit there and get
rich while the companies that EVERYBODY loves just keep paying, and paying
and paying. It does NOT work like that. As I’ve said forever, all of these paper market
prices are determined by the mob psychology dynamics of PEOPLE GETTING
IN…AND PEOPLE GETTING OUT (and far more often than not, the OUT being the
general public getting the shaft straight out of NYC).
Yes…Still Short Cattle
I still have no doubt that last fall’s rocket shot
to record highs was driven by euphoria and cattlemen PILING in to Feeders
with a “no way to lose -pay ANY price” mentality…And going forward, between
February and May (more or less) that avalanche of buyers will…ALL TOGETHER
NOW…be needing to market (SELL) those steers as they mature into slaughter
ready weights.
When you are at the bottom of an agricultural market,
everybody knows there’s a lot of it, and even though the markets have
obviously priced in this KNOWN fact, the typical trader perspective is,
“How can it possibly go up?” But it DOES…And conversely, there probably
hasn’t been a single top in commodity market history that wasn’t basically
accompanied by something like, “The numbers are the lowest in 75 years, so
how can it possibly go really go down very much?” But that is how
the futures markets work…I firmly believe that the highs, for many years, were made last
fall in the Cattle Complex…and that the recovery we’ve seen since November
has been a classic bear market rally back towards the highs…that might be
failing here, and is about to be followed by a devastating sell off that
will take prices lower than anyone in the cattle business would think
possible as all of those Fed Cattle owners, already losing
money, are forced into selling…AT WHATEVER THE PRICE MIGHT BE.
I CONTINUE TO RECOMMEND BEING SHORT BOTH FEEDER CATTLE
AND LIVE CATTLE…and I do intend to take the profits this if we get
the 20% (70 cents per contract in Feeders, 45 cents in Live) sell off that
has been their bear market NORM going back decades.
Some then and now…
Believe me...230-240 Feeders at the October 2014 high
was just insane compared to the previous record highs, but even so, at that
top the whole Cattle world had become wildly and resolutely bullish due to
"the smallest herd in 50 years!", which IS the same story that’s
out there today…implying high prices forever…BUT…a year later prices had
dropped by over 40%...and then stayed that way for another 5 years…And I
see no reason for this time around to be any different. I keep saying
it…This IS how the futures markets DO work.
Buy the Row Crops
THE MOST UNDERVALUED ASSET CLASS
In the markets today…
Yep. There are big crops and big supplies everywhere.
But that IS the way it’s been for virtually every commodity market bottom
in history. I don’t care what anybody thinks about what China will do…or
how “expensive” our crops are relative to South America or anywhere else…or
how much acreage will go into any of
them…or what current stocks are relative to history…Plain and simple, you ignore
all the bearish analysis out there (by all of the same people who were
bullish as we went down for the past 3 years) and BUY CALLS IN ALL FOUR
MARKETS, knowing that if just one of them gets going, you
could still possibly make money if the other three just do nothing or
totally go in the tank. Obviously, all four could do nothing, meaning
losing 100% of what you put on the table…But for my money, and my concept
of risk vs reward, I don’t think it gets any better than this…and would
also note, that typically these four markets do have a tendency to move in
unison…and I would not be buying all four if I didn’t think that they will
all be going up from here. I MIGHT BE DEAD WRONG BUT I THINK THIS IS A
GREAT, GREAT BET.
Check out the math yourself and see what YOU think…
BUY COTTON
BUY WHEAT
BUY CORN
BUY SOYBEANS
If you see this in the same way I do, I definitely think
it makes sense to buy all four markets (about $5000) as one unit. Again, if
just one of these gets going, it CAN pretty much cover the total
investment…And as for what happens if they all go, even moderately,
well…just do the math for yourself…And DO know that the targets I’ve shown
here are NOT wild ass expectations. In every case here, what I’m supposing is based on how all of these markets DO move.
Also…Be aware that there is a LOT of time between now
and July…and a LOT that can happen...BEFORE you start seeing any headlines
noting that “the crops have been rallying.” In other words, get ahead of all that and get
on now…especially while all of these calls just look cheap as dirt to me.
Ready to make some money this year…
Contact me if you’re interested.
Thanks,
Bill
770-425-7241
866-578-1001
All option prices in this newsletter
include all fees and commissions. All charts, unless otherwise noted, are
by Aspen Graphics and CRB.
FUTURES TRADING IS NOT FOR EVERYONE. THE
RISK OF LOSS IN TRADING CAN BE SUBSTANTIAL. THEREFORE, CAREFULLY CONSIDER
WHETHER SUCH TRADING IS SUITABLE FOR YOU IN LIGHT OF YOUR FINANCIAL
CONDITION. PAST PERFORMANCE IS NOT INDICATIVE OF FUTURE RESULTS. THERE IS
NO GUARANTEE YOUR TRADING EXPERIENCE WILL BE SIMILAR TO PAST PERFORMANCE.
The author of this piece currently trades
for his own account and has a financial interest in the following
derivative products mentioned within: All of them
|