1. See important disclosures on last page 1 www.eqstrading.com
SIGNALS
Are they doves or hawks? The FOMC
minutes were released Wednesday and we
still do not get a clear picture of where rates
are going. The minutes we got last week are
split and you can feel lines in the sand draw-
ing as some members are fighting for an
increase and some still want to stay the
course and keep rates near the zero peg.
One thing to keep in mind is that Fed meet-
ing took place before the yuan devaluation
rocked world as we reported last week in
“Signals.” A line from the report stating:
"several participants noted that a material
slow-down in Chinese economic activity
could pose risks to the U.S. economic out-
look" which caused the markets to take it as
if the Fed was already consider-
ing a Chinese slowdown then the
devaluation would be a major
debating point for the next meet-
ing and could cause the Fed to
pause on a September hike.
The troubling problem is that the
“market” had been “rewarding”
a delay in a rate hike with in-
creases in the equity market.
However after the FOMC notes
were released it looks like the
hike may not occur in September
and bonds, equites and com-
modities all took a massive beat-
ing.
The curve is still pricing in a rate hike in September,
but the probability fell from the last report, however
most economists still tend to think that the Fed will
lift off in September, but the line is fairly well split.
After the minutes, the dollar lost ground which would
typically give some support to oil and the commodity
sector; however the bears just beat down everything
in the market but gold Wednesday, Thursday, and
Friday.
It would seem that the Fed just can’t win. We talk
about it every week, uncertainty drives fear, and fear
drives volatility. As traders we love volatility as long
as we are on the right side of it, but the fear is that
the Fed is handcuffed. China (all of Asia for that mat-
ter), Europe, and counties that depend on oil all have
the flu, and it is spreading. (continued on Page 2)
Why The Fed Can’t Win
Since our short call on
7/13, WTI position has
gained 29%!
**You can achieve these
results with discipline and
by following the EQS daily
trade recommendations
and using the daily EQS
Stop Loss guidance
I N S I D E T H I S I S S U E :
The Fed Continued 2
Natural Gas 3
Oil and Products 4
About EQS 5
Terms and Disclosures 6
EQS TR A D E RE C O M M E N DA T I O N S
THE SOUR C E
F OR C OM M OD ITY
TR AD ING SIGN ALS
Volume 1, Issue 9 August 24. 2015
A Weekly Publication on the Commodity Markets
TM
Commodity Symbol Position Entry Date Entry Price Stoploss
Current Position
Profit (Loss)
Rolling 1-Year
Annual Return
Rolling 5-Year
Annual Return
Rolling 10-Year
Annual Return
Average
Volatility
Sharpe
Ratio
Max Draw
Down
WTI Crude Oil CLV15 Short 7/13/2015 52.78$ 2.40% 28.64% 41.61% 33.16% 35.44% 11.1% 3.92 -31.00%
Brent Crude Oil EBV15 Short 7/13/2015 58.61$ 1.70% 24.38% 56.84% 34.20% 44.28% 44.0% 1.30 -30.44%
Ultra-Low Sulfur Diesel HOV15 Short 7/13/2015 1.7360$ 1.60% 21.63% 62.07% 24.32% 33.84% 24.0% 1.51 -30.42%
Gasoline RBV15 Short 7/13/2015 2.0451$ 2.45% 29.44% 42.50% 29.85% 52.37% 38.6% 1.74 -31.34%
Natural Gas NGV15 Short 8/17/2015 2.801$ 1.10% 4.93% 34.71% 61.90% 89.91% 116.1% 1.30 -38.24%
This performance is simulated using corresponding stop loss recommendations. Refer to important disclosures on the EQS Trading website. No leverage utilized on these results.

2. See important disclosures on last page 2 www.eqstrading.com
(Continued from page 1)
Because the Fed is running out of tools to fight the flu, the fear is that no matter what
happens with monetary policy, America may catch the flu.
The “Signals” cover story on July 27th asked the question, “Are Commodities Pointing
to a Global Recession?” As we discussed in the feature article, a commodities melt-
down is the first symptom of the flu. Liquidity-driven markets love low interest rates
and massive money creation. But low rates cause imbalances (the argument to raise
rates), and the bang for each dollar of newly-printed or borrowed currency falls to zero
and then turns negative.
What’s happening now as the major economies continue to borrow but can’t seem to
turn the proceeds into measurable growth. The world is running epic deficits and
monetizing the whole thing, but as a whole the world is not getting the bang for each
dollar in returned
growth. Basically
debt to GDP is
soaring at an ac-
celerating rate
and it is starting
to correct.
As we pointed out
back in July, com-
modities can be
precursors of
slowdowns. Oil is
a high fixed cost
industry, once
rigs are pumping
it is more eco-
nomical for pro-
ducers to keep
pumping and as
global economies slow, demand slows, we get supply glut, and prices fall. We are
starting to see the slow down we reported on in July hit the more broad market as fear
is hitting the market that the it is not a matter of the Fed not raising rates, but a mat-
ter that the Fed doesn’t have the needed tools to fight the flu.
In the grand scheme of things a quarter or eighth of a point likely does not really mat-
ter, but what matters is the Fed’s credibility. The United States led the world into re-
cession in 2007, the question now is does the Fed have the medicine to get the world
out of what lies ahead?
WHY THE FED CAN’T WIN...(CONT.)
Liquidity-driven
markets love low interest
rates and massive money
creation. But low rates
cause imbalances….

3. See important disclosures on last page 3 www.eqstrading.com
Well, summer did not come to the rescue for natural gas this year and the bears are becoming more ag-
gressive after this week’s technical support failure (see chart).
Strong production has been the major force keeping prices
low. According to the U.S. Energy Information Administra-
tion’s Short Term Energy Outlook, U.S. producers hit a total
marketed natural gas production of 78.3 billion cubic feet
per day in July, a jump of about 4.4 percent year over year.
The EIA estimates that could grow to 81.4 billion cubic feet
by Dec. 2016. Much of that production has been headed
into storage and by early November, the EIA estimates
storage will reach 3.87 trillion cubic feet, the second high-
est level on record.
On the other hand, demand has been impressive and this
supply could be draw down if natural gas demand in the
power sector hits an all-time record in 2015. The increase
in demand has been driven by warm summer weather as
well as power producers abandoning coal for cheap, and
relatively cleaner natural gas. Another demand spike tradi-
tionally comes during the colder winter months.
Prices could see a slight boost as the long-awaited new
U.S. LNG facilities commence operation. Cheniere Energy
is set to bring online its Sabine Pass liquefied natural gas
export facility later this year, and more LNG export facilities
are in the works. Analysts forecast that LNG exports are
expected to average 700 mmcf/day in 2016, reaching 8
Bcf/day by 2020. Exports to Mexico have also risen by
about 700 million cubic feet year over year.
It’s hard to believe
these LNG export facili-
ties are about to com-
mence when back in the
early 2000s, there was
fear that the US was
running out of natural
gas! In response, the
US had dozens of LNG
import facilities under
evaluation as compa-
nies rushed to bring in
natural gas from other
countries. By 2010,
total US LNG import
capacity reached almost
15 bcf/day, around one-
fifth of the US total gas
demand that year. Im-
ports of LNG peaked
around 2007, and then
the shale natural gas
revolution began.
As mentioned in previ-
ous issues of Signals,
keep watch on a settle above $2.95/mmbtu, which is a key resistance level. Also look for a reflection
point sometime in September as it is the month where the most instances of yearly lows in NG spot prices
occur. Until then, losses could accelerate as the bears are becoming more aggressive.
WHERE DID SUMMER GO?
Natural Gas
Bearish
NG Weekly Support Failure
Unlike today, back in the
early 2000’s, there was fear
of the US running out of
natural gas!. This spurred
an onset of proposed LNG
import projects (see FERC
caption from 2006). Now
we have so much that
natural gas is flared and
LNG export projects are
commencing soon...
Flashback to 2006: LNG Import Facilities

4. See important disclosures on last page 4 www.eqstrading.com
$30...drink that in. It
was not too long ago (in
July) that EQS initiated
its short position at just
over $52. We were
then talking about $50,
then $40, and on Friday
intraday prices dipped
under $40 to trade with
a $3 handle. This
makes eight consecu-
tive weekly losses for
crude, the longest losing
streak since 1986.
Oil is getting hit in every
direction. Inventories at
record highs, rig counts
still increasing and now global economic fears as
a sharp drop in Chinese manufacturing increased
worries over the health of the world's biggest ener-
gy consumer. Activity in China's factory sector
shrank at its fastest pace in almost 6-1/2 years in
August as domestic and export demand dwindled,
adding to worries about lower consumption of
crude as the second-biggest oil user.
WTI broke through its major support level that can
be traced back to 1999 (see attached chart) and
appears to be headed towards the lows reached
in the height of the 2008 financial crisis. This
particular chart plots the WTI crude oil 12-month
strip and it reveals the support level was actually
broken late last year only to become major re-
sistance in 2015. As seen, the rebound in oil
earlier this year failed to breach the resistance
MAKE THAT EIGHT DOWN WEEKS...
Bearish
Oil & Refined Products
line and then fell to new yearly lows thereafter.
Not even a weaker dollar could rescue the de-
cline in crude this past week. The DXY (an in-
dex of the value of the US dollar relative to a
basket of foreign currencies) declined after the
FOMC minutes revealed that the Fed may not
be ready to proceed with a rate hike in Septem-
ber. Since the minutes, the DXY declined which
sent gold prices on an upward tear. But black
gold began to decouple from its relationship
with the dollar and continued heading south.
The main reason for black gold’s behavior is
that a strong global economy translates into
strong industrial oil demand and when the Fed
hinted it may not hike rates in September, the
market views this as a lack of confidence in
economic growth and thus bearish for oil de-
mand and price in general.
Are you hungry to go long?
With the DXY showing signs
of vulnerability, watch for
signs of sustainable produc-
tion declines along with
stability in the global equi-
ties market. If production
confirms a plateau and the
global economy stabilizes in
the midst of a slowing Chi-
nese economy and US rate
hikes, we should see signs
of a reflection point in oil
prices. The 12-month strip
shows major support at
$32.50/BBL.
Crude and product
inventories are at the
highest level since the EIA
began reporting this data
back to 1990.
WTI Oil Prices – 12-month Strip
1998 2009 2015
Support
Becomes
Resistance
Next Major Support is $32.50

5. See important disclosures on last page 5 www.eqstrading.com
Why You Need EQS
From technicals to fundamentals to macroeconomics, analyzing commodity mar-
kets can be a daunting task. Let EQS do the work for you. Through its subscrip-
tion service, EQS Trading provides traders and hedgers easy to follow trading
signals for major commodity futures markets, including crude oil, natural gas,
gold, silver and many others. Now, strategies used by institutions and hedge
funds are at your fingertips. The subscription service includes both daily trading
signals and the weekly Signals Newsletter, which provides in-depth insight to the
commodity markets.
EQS Capital Management also offers a commodity hedge fund (EQS Commodi-
ty Fund LLC), which employs the same signals in its subscription service in a
private
placement
fund for
accredited
investors
and institu-
tions. Be-
cause EQS
uses a
“long” and
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egy, it is
designed to generate returns, regardless of which way the market is moving.
EQS Commodity Fund imbeds strict risk management principles through diversi-
fying its portfolio (energy, metals, and agriculture) and actively managing stop
loss limits.
What is EQS?
Economic Quantitative Strategy (aka EQS) is an investment and trading strategy
that translates economic data and technical indicators into price direction for
commodities. Because of its quantitative nature, EQS has been rigorously back-
tested with 15
years of histori-
cal data to en-
sure the strategy
works in a variety
of market condi-
tions. Further-
more, because
the global econo-
my changes over
time, EQS em-
ploys dynamic
parameters that
evolve as the
market changes.
About Us
Who is EQS
Richard C. Rhodes
Mr. Richard C. Rhodes is the President and Found-
er of EQS Capital Management LLC. Richard has
a Bachelor of Science with honors in Mechanical
Engineering from Texas A&M University and an
MBA from Duke University. He brings almost 25
years of diverse energy experience, covering all
phases of the oil and natural gas value chain from
producer to end-user. Richard is a licensed Series
3 CTA (Commodity Trading Advisor) with the Com-
modity Futures Trading Commission and a mem-
ber of the National Futures Association.
With close to 25 years in the energy and commodities market, Richard started
his professional career on a drilling rig in West Texas with Conoco Exploration
and Production. Richard continued his oil and gas career with Koch Industries
(ranked as one of the largest privately-owned companies in the U.S.) where
he worked in midstream, refining, pipeline, and distribution operations. During
his eight years with Koch Industries, Richard began as an operations engi-
neer and later found his true passion in trading, which leveraged his profes-
sional interests in mathematics and economics. Richard joined Duke Energy
in 2002 (the largest utility in the nation), where he spent ten years working in
the energy trading department and earned The Pinnacle Award, the compa-
ny’s highest honor. Richard then left Duke Energy to launch EQS Capital
Management in 2012.
Jonathan M. Lamb
Mr. Jonathan M. Lamb is the Director of Busi-
ness Development at EQS Trading. As a four
year varsity hurdler on the track team at Ball
State University, Jonathan earned Bachelor of
Science degrees in Risk Management, Insur-
ance, and Economics, and started working on
his PhD in Economics at North Carolina State
University before focusing on business and
trading.
As part of the first wave of Millennials to join the
work force, Jonathan started his professional
career almost 15 year ago, joining ACES Power Marketing as an Operations
Specialist, providing demand side economics for Co-Op Power Providers
before becoming a Real-Time Electricity Power Trader. He continued his
career trading power for seven years with Progress Energy (now Duke Ener-
gy, the largest utility in the nation) as a Senior Real Time Trader. Jonathan
then opted to become an entrepreneur and started a consulting firm specializ-
ing in finance and economics, owning and running seven different small busi-
nesses before joining EQS in 2015.
WHAT AND WHO IS EQS?

6. See important disclosures on last page 6 www.eqstrading.com
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THE SOUR C E
F OR C OM M OD ITY
TR AD ING SIGN ALS
TERMS and DISCLOSURES