Month: February 2020

Fundamentals?

If you have been watching the debates, caucuses, or media, then the current odds from the betting website predictit.org should not surprise you.

I do not want to get into the politics. I just stick with the cause and effects. The below image lets you know that Bernie is anti-guns.

The market is likely going to bet on a surge in gun purchases ahead of a potential Bernie victory, thus boosting earnings of gun companies.

Technicals?

A breakout at the drawn resistance in $AOBC would add to conviction.

American Outdoor Brands Company ($AOBC)

Confirmation of a breakout in $VSTO would add to conviction.

Vista Outdoor ($VSTO)

A run and breakout at the long-term resistance line in $RGR would add to conviction, but this one is likely ready to play now.

Sturm, Ruger & Co. ($RGR)

A breakout of $OLN would add to conviction.

Olin Corporation ($OLN)

How do you know that bottom was related to the election?

From 2/13/20 to 2/22/20, Bernie gained 15 cents. That means the odds of him winning the Presidency rose by 68% in less than 2 weeks.

All four of those stocks bottommed in their recent consolidation patterns between 1/10/20 and 2/3/20. Imagine those bottoms as being the buyers that had to bet before the fact in order to fill their position without moving the market.

I also want to say that I believe if other democrats had not performed so poorly Bernie may have even taking cents away from Trump. Trump could not fall because the other democrats (mostly Bloomberg) coughed up so many cents.

I believe that Trump will begin to lose cents to Bernie. This is due to the premise that Trump has run his Presidency on the economy as graded by the stock market. Coronavirus is a serious issue. The left should have an easy time blaming Trump for choosing his stock market over the health of Americans at risk of the coronavirus.

No ETF is available to play gun stocks. These would likely be the components if there was one. Buy breakouts, sell fakeouts here.

A last thought: I wonder if these stocks were too significantly hurt with the rise in ESG (Environmental, Social, and Governance) investing.

Teucrium Agricultural Fund

What is it?

Fundamental idea?

It is quite obvious now that the FED will stop at nothing to give us the wonderful gift of inflation that they say we so desperately need. Gold has snuffed this out, and it seems $TAGS has as well. Agriculture as a commodity has me more interested at the moment than others because many others have ties to economic strength.

Technicals?

Long-term downtrend line violated. Support found with an inverse head and shoulders pattern forming as a launching pad for the re-price.

Sugar is flying. Will it break out on this run or fall back to create a mega inverse head and shoulders pattern? I would add directly to Sugar ($CANE) if that happened.

Corn bottoming would add to conviction.

Wheat looks great. You could consider a direct trade in ($WEAT).

Soybeans still making a decision. Once the long-term downtrend is firmly violated, then conviction will increase.

Back to $TAGS. I would not be surprised to see a new high in the future. If symmetry serves us then you could forecast an over 3x return over 7 years.

Give up on this trade if $TAGS trades below here.

A note: There are many people looking at the demise of fiat currencies as an opportunity to play outlasting currencies against each other. While that is happening, there will be bull markets in commodities in some sort of optimal order over the next decade if you were to invest. I think that is the better framework to take going forward.