Monday, May 17, 2010

Marc Faber's 3 Favorite Commodity Picks Right Now

Last night, we posted a Marc Faber interview over at our sister site, The Contrary Investing Report.  Most of the interview focused on Faber's outlook for China - he believes a crash is coming within the next 12 months.

For us commodity traders, Faber dropped a very nice tip right at the end of the interview.  He thinks agriculture is getting real cheap - perhaps making a major bottom - and specifically said that corn, wheat, and soybeans could be interesting plays.

As you can see, the grains (represented below by ETF DBA) have not "reflated" much over the past year - they've been largely left behind:

Are the grains forming a major bottom? (Source:

In my experience trading the grains, I've found that it's best to wait for them to make a move, before piling in. Major breakouts are often excellent times to buy.  

So we'll be keeping an eye on this developing story, and my interest is certainly piqued after Faber's comment.

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