Cold As Ice
Trader Scott’s Market Blog
While I assume that the geniuses from the Social Justice Warrior “movement” would claim I’m a climate change denier, I do actually believe in “climate change”.
But as opposed to the believers in the trendy “theory” of climate change, anyone with an IQ above an earthworm knows we’ve had climate change on this Planet for eons.
So is the Earth currently warming or cooling or neither or both? I believe the weight of the evidence is that currently the earth is in a cyclical cooling phase.
And what does this have to do with markets? Well specifically to agriculture, maybe nothing or maybe a lot. I understand the last statement is completely useless.
But that’s the point. Everything I’ve written so far should have nothing to do with your judgement regarding markets – specifically RIGHT NOW is the RISK low enough and are thePROBABILITIES high enough to justify an investment.
I am wildly bullish long term on agriculture, but neither global warming (nor global cooling) will influence my wager/bet/investment in any way.Only my judgement on what the future TREND of agriculture will be has any bearing on my actions. And that judgement is generally based upon my analysis ofthe SUPPLY/DEMAND situation. That’s where my constant repetition about learning the interaction between PRICE and VOLUME on a chart fits in. That is by far thebest way to determine when, where, how long and how far the next big move in a market will be. And I’ll repeat – the master of all of this was the greatRichard Wyckoff.
Below there is a chart of wheat going back 40 years. Most agriculture markets are showing the similar tendency. What I believe is going on is a humongous area of accumulation.
I previously wrote starting several years ago (archived), that I did expect that in general the commodity bear market which began in 2009 would end in the Spring of 2016, which I maintain still.If I’m correct (and I, of course, believe that I am, but we will eventually find out), then agriculture is embarking on a massive bull market/uptrend. Of course, the question which is alwaysof utmost importance to me: “When will the big moves higher commence?” No one, especially myself, knows the exact answer to that. This is all about the concept of RISK.So what I do is to use myexperience in judging SUPPLY/DEMAND via PRICE and VOLUME (shown on the chart below). And I do believe DEMAND is taking control of the market.Therefore, I am using price weakness to add to my position at SUPPORT to buy the RJA ETF. RJA is shown in the second chart below – a ten year weekly chart.
So to recap. I do believe the Earth is cooling. But in no way is that why I’m investing in agriculture. I’m investing in agriculture, because of my belief in a huge ACCUMULATION area,which will lead to a massive bull market. And the RISK is currently justifying beginning to buy into weakness at SUPPORT.
HOWEVER, any extreme temperature changes will only serve to supercharge the potential UPTREND. And I always like to have that potential turbo charger behind me when I make any investment.Like when I bought gold in 1999, 2008, and 2015/16 specifically gold stocks, like GDX and GDXJ or when I bought US Govt. Bonds in 2000 or when I bought stocks in 2009.(Look at the archives where I discussed these many times.)All of these purchases were made because of my belief in a massive bull market about to commence, but each situation had a particular turbo charger potential attached to it also.
And lastly I included an article which made me chuckle, but I’d imagine the trendy climate changers won’t want you to read. The article from the Daily Caller is shown below.