2021 is finally here, and I am going to keep this note short and sweet. The markets look to be setting up for another parabolic move higher. From an economic standpoint, we should see growth continue to accelerate, inflation to grind higher, and the FED to remain accommodative. That combination should prove supportive for a wide range of commodities leaving year over year demand growth to outstrip supply.
As of the time of this writing, some of the standout "year to date" performance figures for commodities are Lumber +67%, Silver +47%, Soybeans +37%, Palladium +28%, Copper +25%, Gold +24%, Sugar +15% and Platinum +10%. The worst four performers are Gasoline -17%, WTI Crude Oil -21%, Brent Crude Oil -22%, and finally Heating Oil -27%. Heating Oil acts as a proxy for diesel fuel and bunker fuel, and with the global economy coming to a screeching halt, these commodities could be the best performers once a reopening happens.
High Conviction trades for 2021
Long April Silver 29.50-35.00 call spreads
Long February Copper 360-365-368 call butterflies
Long March 10-Year Note 138-135 put spreads
Long March mini Crude Oil futures using a scale in approach at three and four-star support levels.
Long March Copper futures from three and four-star support levels
Short March U.S. Dollar futures against three and four-star resistance levels
Long April Platinum Futures
Long the March Micro Russell on a correction to three and four-star support levels
Long the March Canadian Dollar (it is a commodity currency that works inverse the U.S. Dollar.
We will be putting out a new recommendation on gold using the June contract this week.
One way to get your 2021 on track is to register for a free two-week trial of our Morning Express. Here, we provide actionable technicals, fundamentals, market bias, and our proprietary levels for the most actively traded futures and commodity markets including gold and silver. Also, on Thursdays, we will be putting out an additional note on Copper and Platinum. You can register here: The Blue Line Express Two-Week Free Trial Sign up.
Good luck and good trading,
Chief Market Strategist
Blue Line Futures LLC
Chicago IL 60604
Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.