Monday, July 6, 2009

Monday Morning Thoughts

More weakness in the market this morning, mostly driven by weak commodity prices. Still seeing organized selling (whatever that means), but its an improvement over the panic of the previous legs down (last fall and this March).

-Natural gas dropped again hard this morning. I've got some lower limit orders out there to pick up some more shares if I can. These are really cheap prices. Commodities are volatile, and natural gas especially so. But I've already made my case for investing in this, and I think patience will pay off.

-Railroads are continuing to show relative strength (NSC, BNI, UNP are the ones I watch). I'm not sure if that is the market pricing in a broader market recovery, or are on board with their business model moving forward. I'm a proponent of the latter. I think a broad market recovery is premature, but I do like rails. So, I've been looking to buy some shares. But they haven't fallen much.

-I still think crude oil is too high. It trades on different dynamics than nat. gas, and gains more traction when global stocks rally. I'm still an oil bull in the intermediate term, and would like to scoop up some shares of Diamond Offshore (DO) if I get the chance.

More to come on this busy week. I'll update if my UNG order gets filled.

Disclosure: Long UNG.

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