Is a 50% decline enough? Time to catch a falling knife?

Posted by Chris Kimble on 07/12/2011 at 9:41 am; This entry is filed under Cotton.

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Does a large decline in Cotton suggest anything about the consumer or the global economy?  I don't know, I will leave that up to much smarter people than myself.  Feel free to comment or email on this macro topic if you would care to-

Is a 50% decline in Cotton over the past 4 months enough of a decline to step in an buy it? 

The "Power of the Pattern" looks to be suggesting that Cotton needs to decline a bit further before investors might want to pick up an asset that has fallen a ton in price.  Keep a close eye on the Cotton ETF (BAL) for short-term bounce opportunites that could be close at hand.

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2 Comments

  1. SP July 13th, 2011 at 1:58 pm

    Very nice timing on cotton Chris. I see that BAL is performing well. Do you think it’s entirely due to the dollar index falling?

  2. Chris Kimble July 13th, 2011 at 7:17 pm

    SP…Thank you…I look at each one of these on their own. Cotton if further from its 52-week high than any commodity on the planet. That has me interested to see if we can find a favorable pattern. Great observation.
    Chris