I hate the new blogspot dashboard

Was out of town, didn't post my last trades.  Still in them.
Short silver at 31.50
Short copper at 362.25
Short EUR/USD at 131.30

Ouch

Well, the first major setback of the year.  Apparently, someone thinks we've hit a bottom in copper/China.  I had a short position on it but closed it when it started to rise quickly.  The price went parabolic, going up 1%+ in ~ 30 minutes on no news.  So I shorted, with a lot of leverage, but it looks like the speed and size of the move caused a lot of other people to cover their shorts and the price continues to move parabolic.  I could see this price movement continuing for a while - long enough for me to get a margin call - so I closed my position at a sizeable loss.  Let's see what happens tonight and tomorrow with the Spanish housing price index and the Spanish and Italian bond auctions...

Short copper, loss of 12.7%.


Update: Made it worse.  There is panic-buying (short covering) going on right now.  Going to step aside for a while...  Loss of 18.1%.

In retrospect, this is still frustration trading from missing out on so much of the shorting opportunity that I was waiting for.  Safe to say I'm on tilt right now.

Trade ~~~

Given that I see:
- Stagnant global growth, at best
- No QE on the horizon, and no hint at it in next week's FOMC meeting, except to say that the Fed still has the capacity to act should the need arise.
- A deteriorating situation in Europe
- Silver has farther to fall than copper, even though copper still has room to sell off

Short QI (silver) at 31.35.  Not too much leverage, and I may keep a tight stop on it.

Update 1: I hope I didn't make a bad call here, but I decided to exit at 31.325 - it just looks like I'll be able to short at a better price (didn't I keep saying that about copper?).

Evaluation and Outlook

Evaluation
While I am up for the year by about 50%, my performance has been sub-optimal and I need to find out why, and then correct as much as can be corrected.
The key driver of my trading strategy over the last month or so has been risk-minimization.  Unable to afford losses, I've restricted the time I've held on to a given trade.  While copper, et. al., have been range-trading the last few months, I did well.  That changed in the last week when the correction that I had been waiting for kept moving prices lower.  I missed the move at 3.80, 3.75 and 3.67, worried about a snap back.  As far as its fallen now (3.64), I can't see entering another short until I see some short covering by others.
Silver, EUR/USD, AUD/USD, ES? also look like interesting/potential shorting opportunities, but again, I would prefer to wait for short-covering / dead-cat bounce before entering another short trade.

I have a feeling I need to remind myself of Rule #2 again:  If you don't know, you don't trade.

Outlook


U.S. - should continue to muddle along.  Not too much better, not too much worse (without an exogenous shock, e.g., Iran, Europe).  I don't see blowout earnings again, but I don't see big misses, either.

Europe - Only a matter of time (but this could be many months more).  The last few weeks have seen a notable deterioration in pretty much all European equity and credit markets.  PIIGS deficits and debts are simply too much given the backdrop of declining GDP.  Would you loan them money?  At any rate?  I didn't think so...

China - Economic data will continue to surprise to the downside and monetary policy easing will not be as aggressive as the market is hoping for (this is why I am so enthusiastic about shorting copper - timing is the issue, though.  The market can stay stupid for longer than I can stay solvent).  Michael Pettis gives very convincing reasons to think that growth for the rest of the decade will be even weaker than the hard-landing crowd thinks.

Iran - Its hard to imagine that all the American military hardware moving to the Persian Gulf is anything other than a message to Iran that this is their last chance to open up for regular inspections and agree to create/use only low-enriched uranium, etc., etc.  At the same time, I think Obama is more worried about his re-election and won't want high gas prices going in to November -- then again, there's a pretty good historical trend of sticking with the CiC while at war...  I would put the odds of Iran seriously backing down at about 25%; odds of Iran throwing the US a bone at this weekend's conference (and the next) at 65%; odds of the bone being good enough at 25%; odds of an Israeli strike within 6 months at 51%; odds of an Israeli strike within 12 months at 75%.  Yes, I just made these numbers up.

:-(

This was a frustration trade.  I completely missed today's selloff in copper and tried to get in too late.  Short-covering has me worried, so I did not leverage too much here and did not want to stay in too long.  I think we still may be in correction-mode, but the market may hold up here for right now.  Hopefully, I don't sleep through the next big move, lol.

Short HG at 365, closed at 366.  Loss of 3.5%.

btw, this ends my longest win streak at 6 in a row.

:-/

Again, I don't like this very-short-term trading, but its hard to have any conviction in either direction at today's levels without more data.  I'm not ready to make a call just yet.
Instead, I traded on today's news of higher than expected Chinese CPI.  That brings doubts about how much monetary easing China will do, and when.  But for right now (after the market collected its collective head), it looks like copper will simply follow risk in general, so this was a very short-term trade.

Short HG at 378.80, covered at 378.20.  Gain of 2.4%.

No New QE Near-Term

As I thought, the Fed minutes released today showed that unless growth slows or inflation falls below 2%, there will be no new QE (for now).  As such, I shorted copper (should have shorted silver, but didn't have a window up to do so at the time).

Short HG at 391, closed at 386.95.  Gain of 13.5%.

Range Trading

Copper (et. al.) continue to trade in a range, so I'm going to continue to range trade them.

Short HG at 386.20, closed at 384.20.  Gain of 7.3%.