This has been a tremendously active week with big volatility and important market turns. We have to begin with last week’s gold platinum spread. We outlined the case in our Gold, Silver, Platinum and Copper Outlook. This week, April platinum traded down to nearly a $50 per ounce discount to April gold. Currently, this spread has rebounded to approximately a $5 discount. That’s as much as $4,500 profit depending on the entry point.
We’ve been following the oat futures market carefully while waiting for an actual buy signal to setup for us to enter. There are multiple confirming factors of the market trying to put in a low before rallying through the expiration of the March contract. We initially began looking at this oat trade based on the seasonal pattern, commercial build in position and the sideways technical action in a declining volatility environment. This trade never materialized as the market feel through the bottom of its consolidation. This time around, the market has provided a classic COT long entry.