Jake Bernstein - What I’ve Learned from You

 By Jake Bernstein - Excerpt from his weekly commodity newsletter

A few months ago I presented a Webinar entitled “The Coming Commodity Crash”. At that time
commodity prices were soaring above and beyond anything that had ever been seen. The rallies
were massive and entirely out of proportion with reality. I cited several reasons for the bull markets
among which were the long term cycles, worldwide demand for commodities, the growing
demand for food commodities by emerging nations, the virtually insatiable Chinese demand for
raw good to fuel their giant industrial machine, huge demand from hedge fund speculators, and
electronic trading. I indicated in my Webinar that the record-breaking rallies were likely to undergo
massive corrections, the long term (secular) trend was not over yet. The crash has come
and many markets are now entering long-term support areas as previously predicted.

As selling panics grip the markets it’s time to look at potential buying opportunities. Just commodities could
“do no wrong” a few months ago, today they are once again a dirty word. Traders, analysts, experts
and forecasters are fickle – they tend to go any way the wind blows. I believe that the current
shakeout is a good thing for the markets and that it is long overdue. But above and beyond
my opinions and rhetoric the KEY to profits now is getting on board for the next legs to the upside.
If you listen the experts who daily spew their opinions on CNBC and other business media you
may believe that the bear markets in commodities are here to stay. You may believe that it will
take several years for prices to recover. You may believe that world economies are on the precipice
of disaster – about to go off the cliff. You may believe that the real estate market will take
several years to bottom. You may have been brainwashed to conclude that the worst is yet to
come. And the litany of negatives goes on and on. I remind you that many of today’s bears were
yesterdays roaring bulls. I look around and I see numerous developing opportunities. I see buy
set ups developing. But I do not, as yet, see many triggers.

As long term support levels are now coming into play its time to begin looking at timing indicators
that will signal lows. And so I find myself once again in the position of being a contrarian. I see
negative psychology all around me. I see politicians talking about a deeper and longer recession
than had originally been expected. I do not see many people talking about buying opportunities.
I see Warren Buffet taking advantage of some opportunities. I see that the time is close and getting
closer for action. But I want to emphasize that while many traders are tuned into short term
opportunities and while these may be profitable I believe that the REAL money the BIG money
will be made by entering intermediate and long term opportunities as they present themselves.
Finally, I place great value in the behavior of YOU my clients and readers. At times YOU tell me
MORE about the markets and the future than I tell you. This is one of those times. A few weeks
ago, my 5-hour Webinar on short term and day trading achieved record high attendance. My new
5 hour Webinar scheduled for early November has attracted only a handful of registrations. What
does it all mean It’s simple and it speaks volumes. Many traders have no interest in learning intermediate
and long term trading and investing methods. This tells me a lot about the markets.

It tells me that the time is drawing near for bottoms. It tells me that the coming lows will be significant
and that the rallies will not be short-lived. This time I have learned more from you than you
may have learned from me. And I thank you for that. But I am giving back to you by telling you
what you are telling me and I hope it helps you.