Every serious trader will tell you the same thing…
Ignore the headlines, read the charts.
But ever since the Iran war started, it sure feels like the headlines are driving everything.
Trump tweets, markets go up. Trump tweets again, markets go down.
And surprise surprise, a mysterious trader just happened to perfectly time a massive bet just minutes before they happened.
I can't stop insider trading. Nobody can.
But there's one edge investors like us have that the insiders can't take away.
Here's what I mean…
Commodities are priced differently than stocks.
Even though everything is technically priced based on supply and demand…
Stocks have the appearance of being "worth" a multiple of some key performance indicator (like revenue or earnings).
And whoever is in control of the forward looking narrative is in control of a forward looking price.
But here's the thing about stocks…
You can "print" more shares into existence if you run out.
And if you want to change the value of those shares, all you need to do is change the narrative.
But if a drought destroys this year's wheat crop, that inventory is gone for good.
And good luck trying to change the narrative if you've got food shortages and power outages.
To be clear, I'm not saying commodity markets can't be manipulated.
Cartels like OPEC exist. Geopolitical conflicts matter. And a well-timed tweet can spike oil for a day.
But sustaining that manipulation requires a large coordinated effort across a physical market.
And these markets are simply too big for any one player to have complete control – especially if its a commodity that expires.
That's why the chart moves before the news does.
When money is flowing into the futures market, that represents true supply and demand for the commodity.
Then, as prices are discovered in the futures market, that information starts to roll downstream into commodity stocks.
And there's no clearer example of this than oil.
Did you know that the energy sector hasn't had a down week since December 22nd?
That's a record setting 14 weeks of consecutive moves higher.