October 5, 2023

 Cotton – AKA White Gold

The Strongest Commodity on the Board

BUY IT HERE

Part of this guessing game (yup, that’s what it is) is looking for clues as to which way markets are headed, or from a related perspective, whether a market is exhibiting strength or weakness…as obviously…whichever may be the case is the direction you want to be positioning for.

And if you compare what Cotton has been doing during the past 3 months, or even the last few weeks, with the somewhat extreme weakness we have seen in just about every major market we trade? Simply stated, while all of these other markets have been taking serious hits, COTTON HAS BEEN TRENDING HIGHER…AND IS BASICALLY RIGHT ON ONE YEAR HIGHS…and to me…THAT IS JUST ENORMOUSLY BULLISH.

I continue to think Cotton is about to erupt for at least 20-25 cent from here and continue to recommend buying calls…right here, right now. I truly believe this could turn into a straight up sort of move.

And btw, if you want to do your own research, I promise you that you will find nothing but bearish analysis out there, with the big, big reason being …from just about every analyst I’ve seen…“Weak demand!”, which frankly, is just nonsense to me. For one thing, that has been the oft repeated reason NOT to buy for the last 10 cents on the upside. And beyond that, without thinking too hard, I’ll add that there has obviously been enough demand to push it up to these one year highs…Also, as I have noted forever, whenever I see a market on its highs, and all I hear from the “experts” is, “Don’t buy it here,” THAT IS EXACTLY WHAT YOU SHOULD BE DOING.

What follows here are charts comparing what Cotton has been doing (for the past 3 months) to pretty much all of the other major markets we trade…

Now compare what you see above to all of these other markets since July 1^st (last 3 months).

And one more time…Here’s what Cotton has been doing…QUITE different from all the other markets…

Here’s the big picture…

 Here’s my immediate recommendation…

And one more observation relating to interest rates and the my bullish call for Treasury Bond futures….

With all of those markets listed above having had recent quite sizeable price declines suggests that another BIG drop is coming in inflation as reflected by the Producer Price Index…or that more specifically, somewhere out in the near future we are going to get a mind blowing PPI number…And if my analysis is correct, it is highly likely that the FORWARD LOOKING Treasury Bond FUTURES contract will have rallied hard AHEAD of that potentially negative PPI release 1-2 months from now. In other words, Bonds will be moving UP FROM HERE, such that by the time all the geniuses on Wall Street realize that inflation has cratered, Treasuries could be 15-20 points higher than they are today.

Lots of good stuff happening here guys. I urge you to call me and get on some of it…

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.

The author of this piece currently trades for his own account and has a financial interest in the following derivative products mentioned within: Cotton, Treasury Bonds