10 March 2022

I have been trading futures a long time so when I read about the massive move in Nickel the first thing I was thinking was someone must be getting killed on the other side of the trade.

Nickel might be an exaggerated version of the volatility in the commodity complex taking place right now. However, we have seen big moves in oil and natural gas and many other commodities. Spare a thought for the number of bankruptcies that will come out of the woodwork in the coming days, weeks and months as the bleeding for some becomes too much and hiding the stories from the public leak out to the press.

We didn’t have to wait too long to read about our first casualty of the nickel surge.

 A Chinese tycoon who built a massive short position in nickel futures is facing billions of dollars in mark-to-market losses after this week’s unprecedented price spike, according to people familiar with the matter.

Xiang Guangda, who controls the world’s largest nickel producer, Tsingshan Holding, and is known as “Big Shot” in Chinese commodity circles, has closed out part of his company’s short position and is considering whether to exit the wager altogether.

There will be many more trading books written about the carnage these markets are wreaking on many trading desks. With volatility comes trading opportunities, those with weak risk management will be exposed.

MarketWatch

Check out that move on oil and the 3% up on the SP500.

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