RJO FuturesCast

Daily Futures Market News, Commentary, & Insight

Volatility – while vol tends to sneak up on most, I can’t say that we weren’t ready for it. Recognizing some key players in the FAANG stocks breaking down over the last week, AND the drastic w/w change in our IVOL signal, I actually rented a modest short position over the past few days in “growth” aka NASDAQ. As I mentioned yesterday’s letter, we remain bullish on the cycle, but with the VIX and VXN (NQ volatility) breaking to bullish trend in the last 24hrs, I need to stop and respect that signal. Whether we hold bullish trend for more than a day remains to be seen (I don’t think it will). Keep an eye out…the Russell 2000 has me interested, but wait for me on this. 

Commodities-  Buying/trading opportunities lay ahead.  

*We’re housing some Silver on our books that’s moved against us for a couple of days, but honestly, I see no imminent signs of trouble here. Silver remains bullish in the model, and more importantly, bullish trend. If we see a trend breakdown here, we’ll respect that bull to bear phase transition and exit with no questions asked. 

*Copper and Platinum are both correcting, very intriguing dips to look at buying here.     

*Oil/Energy – no dip here. Despite the massive build in inventories of CL yesterday, we’re +5.00% over the past 2 days. 

China Stagflation? Something to consider in regards to commodities, is China looks to be moving into a Scenario 3 set-up. They are likely to begin to see some ‘stagnation’ in growth. Of course China is the worlds largest consumer of commodities globally. This is something we’re monitoring closely, Shanghai -2.05% breaking trend last night. 

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John Caruso

Senior Market Strategist
Follow John on Twitter @JCarusoRJO. John began his career at Wilshire Quinn Capital, a Wealth Management Firm based out of Los Angeles, California. John made his move to the commodity industry at the end of 2005, and began his path at Lind Waldock, at the time the largest retail brokerage division worldwide. John did his undergraduate work at Robert Morris University in Pennsylvania from 1999-2003, where he was a 4 year varsity basketball letterman.  A self-professed “Macro Trader”, John uses a multi-factor fundamental and “quantamental” trading model in distinguishing market cycles based upon the accelerations or decelerations of growth and inflation metrics. His technical and quantitative approach is heavily reliant upon trend and market range analysis via a custom built standard deviation system in helping him make probability-based market decisions. John is an avid reader of all things pertaining to finance, and behavioral economics. Click here to sign-up for John Caruso's Trading Coach Insights. Daily information and insight on all futures marketsin ranging from metals to equities.
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