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Dennis Gartman: Sell Gold Into Any Rally; Crude Oil Challenged

With gold prices recovering on Monday after dropping more than 2% last week, we turned to esteemed commodities investor Dennis Gartman for insights.

And he tells us, reduce positions - keep some power dry. Sell gold into any rally.

Gold

“I had been long of gold (in yen terms),” he tells us, but now, long is wrong.

“In the stock market a 1% move is random noise, but when something moves against you 1% in the foreign exchange market, it's material. Pay attention. When something moves against you 1%, as gold has moved against me, I go to the sidelines.”

At the time of writing Gartman was looking to cut his gold position in half.

Oil

Meanwhile, in the oil market, Gartman reiterated what he first told Fast Money last week. That is, he thinks the path of least resistance is lower for crude oil.

“There’s a lot of crude around – the term structure of futures market tells you that – WTI is in contango .”

“When deferred futures are higher than the nearby, when the nearby are above spot – it’s telling you crude is ample in supply.”

Last week, while we were talking to Dennis Gartmanabout oil he told us, ““I think you have to be very careful trading crude. If it wasn’t for the philosophical problems of the Middle East – crude would be trading $80.”

Nat Gas

And, while we had Gartman's attention, we also asked Gartman about nat gas.

“I have a theory that the commodities markets often try to get to the obscene number – the number no one thought possible. In nat gas, I think we get to a 1-handle."

Other

It’s worth noting that energy bull Joe Terranova is relatively bearish on energy – at least for him. He’s neutral. “I have no interest in commodities right now,” he says.

“If Spain becomes a problem, then the euro will probably go lower. A lower euro will send the dollar higher and a strong dollar is no good for commodities.”

What do you think? We want to know!

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Trader disclosure: On Apr 9, 2012, the following stocks and commodities mentioned or intended to be mentioned on CNBC’s "Fast Money" were owned by the "Fast Money" traders; Joe Terranova is long VRTS; Joe Terranova is long IBM; Joe Terranova is long MCD; Joe Terranova is long EMC; Joe Terranova is long MSFT; Joe Terranova is long GS; Joe Terranova is long HFC; Joe Terranova is long COG; Joe Terranova is long JOY; Joe Terranova is long OXY; Joe Terranova is long LQD; Stephen Weiss is long QCOM; Stephen Weiss is long WLP; Stephen Weiss is long AIG CALLS; Stephen Weiss is long NAV; Stephen Weiss is long HAIN; Stephen Weiss is long JPM; Stephen Weiss is long BAC; Stephen Weiss is short AAPL PUTS; Stephen Weiss is short X; Stephen Weiss is short JCP; Stephen Weiss is short KSS; Stephen Weiss is short XHB; Stephen Weiss is short FXA; Stephen Weiss is short BTU; Stephen Weiss is short ANR; Stephen Weiss is short MT

Dennis Gartman
Dennis Gartman is long gold in yen terms

Chad Bartley
PCS makes a market in the shares of EXPE
PCS makes a market in the shares of GOOG
PCS makes a market in the shares of PCLN


CNBC.com with wires.