Lumber limit up

Lumber is limit up again. I'm taking 1 off to this limit up move. I also raised the stop. What sucks is I'm trying to build a new house, so this high lumber price wouldn't help.

As for nat gas, it's down about $3K per contract. Today is a key day for nat gas, and it could go lower from here. I thought after the last week's move, we could see some upside.

Lumber

I sold 1 Jan and 1 Mar lumber into today's rally. I'm still holding 2 Mar long. For the remaining positions, I set 251.2 as stops. I'll take stops or keep trailing.

NG

I go to ino.com to look at futures price throughout the day. Occasionally there's this picture shown up as a sales banner. Every time I look at this guy, it reminds of me thinking about my nat gas / lumber.

Anyway, I think nat gas is going to make a multi-year low here. Pricewise, it's not the new low, but if you consider rolls and everything, this is the new low. I'm not sure if I want to add or just watch.

Other than that, I'll roll to Jan contract soon.

A bit of relief

I never thought a day like today would come. I've been holding lumber since Jan 2008. I was very close to marking 2 years. I rolled and added many times. I still don't understand why it's rallying because today I just heard mortgage delinquency doubled this month. Is it just speculation? Who knows.

I've been feeling very sorry to my family. We were going to build a house back in Mar when LB and NG were both rallying, but I was stupid enough not to sell any to lock in profits at that time. Because of my trades, we couldn't do that. It's been very stressful and I found a lot about myself as well.

I'm still holding 5 lots. I'm not sure how I would exit this.

Order execution mistake

March lumber closed at 248.9 yesterday with a limit up. So I meant to place an order to sell at 258.9 in case of another limit up day. I just opened up and found that I sold at 249.9. Lumber is not being traded at 256.2. What the heck. To add that, I sold not just 1 contract, I sold 2. Stupid me.

Will it hold?

ES is at 52 week high above 1100. The chart pattern looks higher, but we certainly don't want to go back below 1100 today, and then it'll change the whole sentiment.

S&P

S&P really needs to close above 1100 if it wants to go higher. Double-top is probably the last thing that index wants to see. This week we poked thru, but quickly formed a reversal pattern. Yesterday we followed through to the downside. If we close above the reversal candle, that'll bring some buyers.

Commodities are not doing well overall because dollar is at a critical level. Looks like a lot of people are watching for dollars. I still see a lot of nervous buyers and top pickers. As long as we continue to see those, I think we'll keep moving higher. When those who have been saying V type recovery is not possible turn into bulls, that's when we should go short.

NG at a multi year low level. Hopefully this forms a double bottom, or I'll be a painful waiting game. LB is doing ok.

Bond / note

I don't understand why bonds and notes are not declining. With indexes up this much, you'd think bonds and notes are down. I looked at the charts and looks like they are right on the neck line of head and shoulder. I still think there are mixed feeling of safe haven v.s. risks. As long as we keep this way, I think stocks keep rallying.

One of things I pay attention is money flow to mutual funds. To recent rallies, what people have been doing was to, in fact, take money out of mutual funds. People who bought at the market top in 2007 made up some of their losses. People who bought in 2008 are break-even, so they are cashing in.

As for gold, I have no idea. JC at TTM has been a gold bug for years. His 'buy gold' every night was pretty annoying, but now I wish I would have bought some and this is the difference between pros like him and idiots like me.

Despite broad commodity rallies, lumber is down quite a bit and nat gas is close to the multi year low (not the price wise, but after roll-overs, this is the contract low). I'm attempted to buy dec call options, but that'll probably add more headaches. I guess since I didn't buy markets go up from here. Who knows if i can ever exit these positions.

Job#

It seems non-farm # ruined all the party. We're still at the point where we keep losing. What we've had since early this year was simply a decrease of the degree of losing jobs. So unless jobs were added, the unemployment rate will not get better.

Nat gas resumed its trend to downside. It'll probably challenge the low again and probably dip lower. I'm glad I covered 1 before it tanked. I was just so close to cover all of them. All I needed was 1 day of staying at the high. Then my options would have been offset.

Lumber has moved to upside slightly. I think that's because of the extended home buyer's tax credit. I don't know how much it'll be helpful. Normally it'd take 6 months for experienced builders to build a house, so if they start building in 1 month (considering getting permits / getting bids etc), they only have 4 months until April. If they find a buyer before the end of April, good for them, but theses days new houses don't get sold before they are done.

Existing home sales are not much different. If you have a family, you probably don't move until your kids schools are done in mid to end of May, so what good is April deadline?

A little guy like me, unfortunately, have to just hope economy gets better. Everything started from housing market collapse. It then went to less consumer spending, company cost cut, job loss, foreclosure / short sales and it continues.