December: The Month Commodities Traders Want to Forget

December 2015 will go down as a month in a year that most commodity traders would like to forget.

This was a month of strong technical bounces in markets loitering in deeply oversold territory. A month where even a shred of news or weather could send markets stampeding to the exit door. December capped off a year in which sentiment did in fact trump fundamentals. A month in which consensus grew to the point where it had itself a posse.

The evolution and or change in commodity trading perception brings to mind strong parallels of the way we view artwork. Up through today, market sentimentality (i.e. consensus) possesses the appealing and evocative attraction of a silhouette.  One in which the observer desires space for imagination and interpretation, while quickly losing interest if the artist left no room for it. For months investors peered at misleading pseudo-pictures including the breathless commentary about China, warnings of FOMC miscues, the potential disruption of inflation, disinflation, and monetary policy.

It’s fascinating how long and far consensus can drive a market. Imagine if consensus is wrong.

Read more – December: The Month Commodities Traders Want to Forget