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July 31, 2025
Tariffs are Bearish
We KNOW that the overwhelming majority (70-80%) of
trading in futures today is done by computerized programs (algorithms and
hedge funds) that are basically feeding waves of money into and out of the
markets…and quite often those funds are headed in one direction, with
allocations being made in that same direction, across a number of markets.
The
five market charts below are not identical, but they ARE very much the
same, and most likely have been collectively influenced SHARPLY HIGHER by
the type of macro market programs I referenced above…perhaps
irrespective of whether or not any of them DO actually any supposed
fundamental basis for having the extreme “values” given to them by the
futures markets…IT’S ALL JUST MONEY FLOW.
Yesterday, Copper
had what was one of the single largest trading days in the history of
commodity trading, dropping over 20% in 1 hour following Trump’s Brazilian
tariff announcement. And wasting no words, I think
it is imminently possible that the same TOTALLY UNEXPECTED fate of Copper… and Silver, Platinum, yesterday & today as
well…is what comes next in Cattle…OUT OF NOWHERE…AS THAT IS THE WAY IT SEEMINGLY ALWAYS HAPPENS IN FUTURES…
If you comparatively trace the dips, rallies, turning points and
sideways moves here, it should be visually quite obvious that funds ARE
moving in tandem…
IT IS MY OPINION THAT TARIFFS ARE IN NO WAY
CONDUCIVE TO PROMOTING ECONOMIC ACTIVITY…IN FACT, BY THEIR NATURE THEY ARE
INHERENTLY RESTRICTIVE…AND WHEN THEY ARE BEING THROWN
AROUND IN EXTREME PERCENTAGES, AND THEN WITHDRAWN, AND THEN IMPLEMENTED,
AND THEN CHANGED AGAIN, THEY ARE NOTHING BUT POTENTIALLY DISRUPTIVE AND
DESTRUCTIVE ON TOO MANY VARIED LEVELS TO ADDRESS HERE…AND, I BELIEVE, WILL
EVENTUALLY (OR FAIRLY IMMEDIATELY ) LEAD TO LARGE, LENGTHY DOWNTURNS IN ANY
NUMBER OF MARKETS…
The truth is, I see the distinct
possibility of another Farm Crisis similar to the mid-80’s could be on the
horizon…where prices for Crops AND Livestock go to devastatingly low
levels.
AND SO YEAH…AGAIN…THE CATTLE MARKET, WHICH
WAS SHARPLY
LOWER TODAY…ON ZERO NEWS, IS AT THE TOP OF MY LIST AS AN IMMEDIATE AND
MAJOR, MAJOR SHORT…
Here’s another option possibility…
As always, I recommend being in both the
Feeders and the Live Cattle contracts…They do generally move together, so
you can pick one if you want, but I never know which will be biggest…
Important
thing is: We DO now have action that suggests SOMETHING might be getting
started on the downside, and with a market that is this unbelievably
extended, the possibly of an initial monster move down IS high…so what you
don’t do, or so say I, is decide to “see what happens.”
BEEN WRONG AND LOSING MONEY… BUT WILL NOT
BE OUT…AS I DON’T THINK IT EVER GETS ANY BIGGER THAN THIS.
New lows again in Soybeans today.
I still strongly recommend being Short both Corn and Soybeans.
Call me.
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: Feeder Cattle, Live Cattle, Corn, Soybeans
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