Look for buying opportunities as the markets stutter, and don't sweat the spate of capital raises among master limited partnerships.

Oil's rally was a major topic in the financial media on Tuesday and Wednesday, and a long list of pundits have attempted to explain the recent rally in crude prices. Many analysts asserted that oil's run-up has little to do with fundamentals of supply and demand, citing murky arguments related to the weaker US dollar and speculative fervor. But fundamementals are still at the heart of oil's recent move.

I see a price squeeze setting up in the July soybean contract as it heads toward expiration. A price squeeze occurs when the shorts (who are obligated to deliver a commodity) can’t find the product to deliver and instead must “pay up” to get out of their short position. This is what happened last September.

The weather is an important factor for investors to consider; expectations and forecasts, even when they ultimately prove incorrect, have a meaningful impact on some key market sectors. In this regard, one of the factors I watch most closely is El Niño Southern Oscillation, more commonly known by the acronym “ENSO.”

A month ago prominent bears were arguing that earnings season for the S&P 500 would cut the rally off the market’s March lows short. But just the opposite happened: Earnings results were largely well-received, and the advance continued.

Because of low prices, farmers in the cotton belt, which includes states such as Louisiana and Mississippi, planted the lowest cotton acres in 25 years. Lower acres equal lower supplies; add in a small carryover of supply from last year’s poor crop and supplies at the tail end of this crop are projected to be the smallest in seven years.

Strong economic growth in China and other emerging economies has been the basic underpinning of the most profitable market trends in recent years, including the dramatic up-trends in energy and basic commodity prices.

Over the past four months the change in LEI hasn’t accelerated to the downside. This is consistent with my view that the rather scary “accelerated contraction” phase of this recession is in the rearview mirror. The economy is stabilizing at a lower level of activity, and we’re setting up for a tepid economic recovery to begin in the back half of 2009 and into 2010.

Why do so many people sell at the bottom, or buy at the top?  It’s because they’re acting emotionally instead of intellectually. There’s one simple way to avoid this: Don’t get attached to any position. Trading shouldn’t be an ego thing. There’s always another market tomorrow, and another yet the week after.

A dramatic weather event last week in the Southern Plains could significantly influence future wheat prices. An untimely hard freeze no doubt caused crop damage and killed a portion of the immature wheat crop.