A Pattern Emerges In The Dollar…

Technical Outlook

#BONDS (JUN) 4/30/2004: The close below the 1st
swing support could weigh on the market. Near-term resistance for bonds is at
107.15 and then again at 108.15, while swing support hits at 105.28 and below
there at 105.09. A negative signal for trend short-term was given on a close
under the 9-bar moving average. A bearish signal was triggered on a crossover
down in the daily stochastics. The next downside objective is 105.09. The market
is approaching over sold levels on an RSI reading under 30.

T-NOTES(JUN) Daily stochastics are trending
lower, but have declined into oversold territory. The next downside objective is
now at 109.10. The market’s close below the pivot swing number is a mildly
negative setup. Near-term resistance for the T-Notes is at 110.24 and then again
at 111.12, while swing support hits at 109.23 and below there at 109.10. The
market’s short-term trend is negative as the close remains below the 9-day
moving average. With a reading under 30, the 9-day RSI is approaching oversold
levels.

 

STOCK INDICES RECAP

4/29/2004

It is pretty clear that investors are concerned
that the US recovery is going to be disappointing, as the 4.2% GDP reading was
simply another reason for sellers to attack prices. The fact that talks in the
Fallujah siege broke down were another undermine during the session as a
continuation of the killing isn’t beneficial to the bull case. It should also be
noted that the US employment Cost Index reading was much hotter than expected
and that led many to rekindle the fears of a June interest rate hike. In short
the bear camp seems to have more ammunition than the bull camp.

Technical Outlook

#S&P500 (JUN) 4/30/2004: The market setup is
somewhat negative with the close under the 1st swing support. Underlying support
comes in at 1102.75 and 1093.88, with overhead resistance at 1124.25 and
1136.88. The close below the 9-day moving average is a negative short-term
indicator for trend. Stochastics trending lower at midrange will tend to
reinforce a move lower especially if support levels are taken out. The next
downside objective is now at 1093.88. Short-term indicators on the defensive.
Consider selling an intraday bounce.

S&P E-Mini (JUN): Negative momentum studies in
the neutral zone will tend to reinforce lower price action. The next downside
target is 1093.88. The swing indicator gave a moderately negative reading with
the close below the 1st support number. The close under the 40-day moving
average indicates the longer-term trend could be turning down. Near-term
resistance for the S&P Mini is at 1124.25 and then again at 1136.88, while swing
support hits at 1102.75 and below there at 1093.88. The market’s close below the
9-day moving average is an indication the short-term trend remains negative.

NASDAQ (JUN) A negative signal for trend
short-term was given on a close under the 9-bar moving average. The close below
the 1st swing support could weigh on the market. The market should run into
resistance at 1456.75 and above there at 1480.38 with support at 1415.25 and
1397.38. Bearish daily studies indicate selling minor rallies this session.
Momentum studies trending lower at mid-range could accelerate a price break if
support levels are broken. The next downside objective is 1397.38. The market
back below the 40-day moving average suggests the longer-term trend could be
turning down.

MINI DOW (MAR) The close below the 9-day moving
average is a negative short-term indicator for trend. The market should run into
resistance at 10359 and above there at 10470 with support at 10168 and 10088.
Stochastics trending lower at midrange will tend to reinforce a move lower
especially if support levels are taken out. The next downside target is now at
10088. The close below the 40-day moving average is an indication the
longer-term trend is down. The market setup is somewhat negative with the close
under the 1st swing support. Short-term indicators on the defensive. Consider
selling an intraday bounce.

 

CURRENCY MARKET RECAP

4/29/2004

The June Dollar Index showed early strength
Thursday but was simply disappointed with the GDP reading. While the +4.2% US
gain in GDP would have been considered stellar by many other countries it was
woefully below expectations for the US and therefore a reason for the Dollar to
correct. It has been a pattern in the Dollar to be easily disappointed by any
number that doesn’t meet or exceed expectations. Given the fact that GDP is a
1st tier number the Dollar certainly deserved to slide 100 points off its
initial high of the session.

Technical Outlook

#CURRENCIES 4/30/2004: YEN (JUN): A negative
signal for trend short-term was given on a close under the 9-bar moving average.
The market tilt is slightly negative with the close under the pivot. Swing
resistance is targeted at 91.61 and above there at 92.15, with the yen finding
support around 90.35 and below there at 89.63. The market back below the 40-day
moving average suggests the longer-term trend could be turning down. A bullish
signal was given with an upside crossover of the daily stochastics. The next
upside objective is 92.15.

EURO (JUN): Momentum studies are rising from
mid-range which could accelerate a move higher if resistance levels are
penetrated. The near-term upside target is at 1.2075. The defensive setup, with
the close under the 2nd swing support, could cause some early weakness. Swing
support for the Euro comes in at 1.1761, with overhead resistance at 1.2075. The
close above the 9-day moving average is a positive short-term indicator for
trend. The close below the 40-day moving average is an indication the
longer-term trend is down. More selling pressure is likely given yesterday’s gap
lower price action on the day session chart.

 

PRECIOUS METALS RECAP

4/29/2004

The gold and silver markets started out extremely
weak but managed to bounce into mid session. The fact that the Dollar Index fell
100 points off its high for the day, seemed to inspire the short covering effort
in gold and silver. It is also possible that a breakdown in the move toward a
political solution in the siege of Fallujah contributed to the renewed interest
in the long side. It should also be noted that the US employment Cost Index has
soared by 3.8% above year ago levels and some are suggesting that inflation
could be a future consideration for the metals.

Technical Outlook

#P-METALS 4/30/2004: SILVER (JUL): The market has
a slightly positive tilt with the close over the swing pivot. Initial support
for silver is at 599.0 and below there at 599.0 with resistance likely at 599.0
and 599.0. A negative signal for trend short-term was given on a close under the
9-bar moving average. Daily stochastics declining into oversold territory
suggest the selling may be drying up soon. The next downside objective is 599.0.
The market is approaching over sold levels on an RSI reading under 30.

GOLD (JUN): Support for gold today comes in near
377.93, while resistance is pegged at 393.73. The crossover up in the daily
stochastics is a bullish signal. The near-term upside target is at 393.73. It is
a slightly negative indicator that the close was under the swing pivot. The
close below the 9-day moving average is a negative short-term indicator for
trend. The upside daily closing price reversal gives the market a bullish tilt.

 

COPPER MARKET RECAP

4/29/2004

The copper market saw some bargain hunting or at
least some short covering as prices managed a modest recovery. Some traders
suggested that strong US demand for copper might serve to offset some of the
potential weakness in Chinese demand and that gave way to some fresh long
interest. Another story out of London suggested that demand for metals in China
would remain strong even in the face of tougher credit practices in China and
that certainly served to alter sentiment in the pit. One might note that LME
copper stocks have continued to contract despite the recent idea that the bull
market in copper is finished.

 

ENERGY MARKET RECAP

4/29/2004

It would not seem like the anticipated Fallujah
deal actually came to fruition and that could have lent some support to the bull
camp Thursday. However, the natural gas market saw what could have been
considered a negative inventory report with US natural gas stocks rising 78 bcf.
The market still isn’t sure have to handle the potential for slowing in the
Chinese economy but many traders think that the US demand growth might pick up
the slack if Chinese energy demand begins to slip. It would also seem like the
fear of terrorist attacks on supply is tapering off and that also forced some
longs to the sidelines.

Technical Outlook

#ENERGIES 4/30/2004: CRUDE OIL (JUN): It is a
slightly negative indicator that the close was under the swing pivot. Support
for crude is keyed on 36.91 and below there at 36.36, with resistance pegged at
37.72 and 37.98. The close above the 9-day moving average is a positive
short-term indicator for trend. A crossover down in the daily stochastics is a
bearish signal. Momentum studies trending lower from overbought levels is a
bearish indicator and would tend to reinforce lower price action. The next
downside target is now at 36.36.

UNLEADED GAS (JUN): Rising stochastics at
overbought levels warrant some caution for bulls. The next upside objective is
125.87. The market has a slightly positive tilt with the close over the swing
pivot. Resistance today is at 125.87, while support should be found around
119.07. A positive signal for trend short-term was given on a close over the
9-bar moving average. The market is approaching overbought levels with an RSI
over 70.

HEATING OIL (JUN): The close over the pivot swing
is a somewhat positive setup. Heating oil should encounter support around 92.10,
with resistance is at 95.70. The close above the 9-day moving average is a
positive short-term indicator for trend. Momentum studies trending lower from
overbought levels is a bearish indicator and would tend to reinforce lower price
action. The next downside target is now at 92.10.

 

CORN MARKET RECAP

4/29/2004

In addition to a solid export sales number for
the week, the USDA announced that Japan bought 148,336 tons overnight. The
strong demand numbers helped support July corn today but December came under
some early selling pressure from the forecast for good weather for planting in
the western cornbelt after scattered rains move out in the next few days. “Less”
concerns over the cold weather threat added to the negative tone but strength in
soybeans and old crop corn helped pull the market higher. Basis was steady/firm.
Weekly export sales came in at 1.07 million tons as compared with trade
expectations at 900,000-1.1 million tons. Old crop sales were 925,400 tons as
compared with 512,900 tons necessary each week to reach the USDA projection.
Cumulative sales have reached 81.1% of the USDA forecast for the season as
compared with 75.7% on average for this time of the year. The International
Grain Council pegged world coarse grain production for the 2004/2005 season at
new record 928 million tons from 904 million last year. Usage, however, is also
pegged at a record high of 941 million tons from 937 million last year. Ending
stocks are expected to fall to 117 million tons from 131 million last year.
Short-term support for July corn comes in at 317 3/4 and 314 with 322 1/2 and
327 as resistance.

Technical Outlook

#CORN (JUL) 4/30/2004: The crossover up in the
daily stochastics is a bullish signal. The near-term upside target is at 325.
There could be more upside follow through since the market closed above the 2nd
swing resistance. Market resistance comes in at 325 today, with support at 311
2/4. The close above the 9-day moving average is a positive short-term indicator
for trend. The cross over and close above the 40-day moving average is an
indication the longer-term trend is up.

 

SOY COMPLEX RECAP

4/29/2004

The bullish news from the monthly Census Crush
report was enough to offset slow exports and commercial buyers were active early
in the session. Census crush for March was 129.503 million bushels as compared
with trade expectations near 128.5 million bushels. Oil stocks were expected to
come in near 1.925 billion pounds and with the higher crush pace, one would
expect higher oil stocks. However, stocks were reported at 1.857 billion pounds.
This supported sharp gains in oil with July moving to the highest level since
March 24th. Meal stocks were 375,593 tons which was in line with trade
expectations. Weekly export sales for soybeans came in at 57,300 tons as
compared with trade expectations at 75,000-200,000 tons. Old crop sales were
49,300 tons as compared with 31,300 tons necessary each week to reach the USDA
projection. Cumulative sales have reached 97.6% of the USDA forecast for the
season as compared with 91.5% on average for this time of the year. Old crop
meal sales were 70,200 tons as compared with 18,800 tons necessary each week to
reach the USDA projection. Cumulative sales have reached 88.7% of the USDA
forecast for the season as compared with 75.9% on average for this time of the
year. Oil sales were just 300 tons. Good weather for planting helped to pressure
November soybeans and lingering concerns with China demand helped limit gains in
old crop. Argentina weather has been too wet recently but dry weather is in the
forecast for much of the next week which might help producers catch up.
Near-term support for July soybeans comes in at 992 1/2 and 989 with 1009 1/4
and 1023 as resistance.

Technical Outlook

#SOYBEANS (JUL) 04/30/04 The market setup is
supportive for early gains with the close over the 1st swing resistance. The
next area of resistance is around 1014 and 1026, while 1st support hits today at
986 and below there at 970. The market’s close on the 9-day moving average is
neutral. Stochastics are at mid-range, but trending higher which should
reinforce a move higher if resistance levels are taken out. The next upside
objective is 1026. Daily studies suggest buying dips today.

MEAL (JUL): Momentum studies are rising from
mid-range which could accelerate a move higher if resistance levels are
penetrated. The near-term upside target is at 315.5. First resistance comes in
at 312.5, with support at 305.0. The close above the 9-day moving average is a
positive short-term indicator for trend. Market positioning is positive with the
close over the 1st swing resistance.

BEAN OIL (JUL): A positive signal for trend
short-term was given on a close over the 9-bar moving average. Rising
stochastics at overbought levels warrant some caution for bulls. The next upside
objective is 34.84. A positive setup occurred with the close over the 1st swing
resistance. Daily swing resistance is found at 34.46 and above there at 34.84.
Support should be encountered at 33.58 and 33.08. Short-term indicators suggest
buying dips today.

 

WHEAT MARKET RECAP

4/29/2004

Solid sales numbers, ideas that the market is
oversold after recent sharp losses and signs of better demand from China helped
support. Weekly export sales came in at 874,400 tons as compared with trade
expectations at 300,000-600,000 tons. Old crop sales were 338,300 tons as
compared with 222,700 tons necessary each week to reach the USDA projection.
Cumulative sales have reached 96.1% of the USDA forecast for the season as
compared with 90.4% on average for this time of the year. China shipped out
198,700 tons for the week. There is also support coming from some light concerns
that the southern plains could get cold enough this weekend to damage some of
the winter wheat crop which is forming heads and more vulnerable to cold weather
damage. With the cold front, however, there could be another 1/2 inch or so of
moisture across much of the central winter wheat areas including into eastern
Colorado which might help improve crop conditions. July wheat support levels
come in at 387 1/2 and 385 with 392 1/2 and 396 as resistance.

Technical Outlook

#WHEAT (JUL) 4/30/2004: The market setup is
supportive for early gains with the close over the 1st swing resistance. Expect
near-term support around 385 and below there at 380 1/4, with resistance levels
at 393 and 396 1/4. A negative signal for trend short-term was given on a close
under the 9-bar moving average. A bullish signal was given with an upside
crossover of the daily stochastics. The next upside objective is 396 1/4.

 

LIVE CATTLE RECAP

4/29/2004

Cattle futures closed sharply higher and into new
high ground for the June contract for the second session in a row and for the
August contract for the 4th session in a row. Slaughter came in at 130,000 head
as compared with trade expectations at 124,000-130,000 head. Slaughter for the
week reached 504,000 head as compared with 493,000 last week and 528,000 head
last year. Boxed-beef cut-out values were down 15 cents to $157.29 as compared
with $159.36 last week at this time. August cattle has now rallied 525 points
off of Friday’s lows.

Technical Outlook

#CATTLE (JUN) 4/30/2004: Rising stochastics at
overbought levels warrant some caution for bulls. The next upside objective is
83.17. The market has a slightly positive tilt with the close over the swing
pivot. Support should be encountered at 80.00 and below there at 78.97. Market
resistance is at 82.10 and then again at 83.17. The market made a new contract
high on the rally. A positive signal for trend short-term was given on a close
over the 9-bar moving average. The market is approaching overbought levels with
an RSI over 70.

 

LEAN HOGS RECAP

4/29/2004

The outside day down after moving to the highest
level in 10 trading sessions is considered bearish technical action for June
hogs as the market closed 57 lower on the session. There is some concern that
the higher cash prices paid recently have pushed packer profit margins down to
the point where slaughter might decline and cash markets may come under pressure
at the same time. The CME 2-day Lean Index for the period ending April 27th was
up 41 cents to $68.81 as compared with $64.37 on April 15th. Slaughter came in
at 380,000 head as compared with trade expectations at 382,000-390,000 head.

Technical Outlook

#HOGS (JUN) 4/30/2004: The market setup is
somewhat negative with the close under the 1st swing support. Resistance levels
comes in at 72.87 and 73.85 today, while support is around 71.27 and then 70.65.
The daily closing price reversal down is a negative indicator for prices. The
close above the 9-day moving average is a positive short-term indicator for
trend. Momentum studies are rising from mid-range which could accelerate a move
higher if resistance levels are penetrated. The near-term upside target is at
73.85.

 

COCOA MARKET RECAP

4/29/2004

The cocoa market managed a sharp and surprising
rally Thursday. Many suspect that the market was simply seeing additional fund
short covering as the newswires were mostly filled with slightly negative supply
stories. For instance, Dow Jones suggests that Ivory Coast arrivals up to April
21st had climbed above 1.02 million metric tons and that should leave the
impressive that plenty of physical supply has come to the market from the Ivory
Coast crop. With recent demand readings sluggish and the Dollar generally rising
the cocoa market doesn’t seem to have a stellar bull case.

Technical Outlook

COCOA (JUL) 04/30/04 The market has a slightly
positive tilt with the close over the swing pivot. Cocoa should run into
resistance at 1426 and above there at 1435 with support at 1401 and 1385.
Positive momentum studies in the neutral zone will tend to reinforce higher
price action. The next upside target is 1435.25.

 

COFFEE MARKET RECAP

4/29/2004

July Coffee closed 90 points lower and would seem
to be headed to consolidation support down at 69.30 basis the July coffee.
Apparently the roll over from May to July is causing some front month weakness
with many generally accepting of the bear story. Reports that coffee exports
from Peru were down 40% to 29,841 bags was mostly discounted. It was also noted
that October through March Peru coffee exports declined by 17% but the market is
apparently not in a position to find support from a minor supply flow stat.

Technical Outlook

COFFEE (JUN) 4/30/04 The market tilt is slightly
negative with the close under the pivot. Daily stochastics are showing positive
momentum from oversold levels which should reinforce a move higher if near-term
resistance is taken out. The near-term upside objective is at 72.00. The Coffee
contract should run into resistance at 70.90 and above there at 72.00 with
support at 69.4 and 69.00. The market’s short-term trend is negative as the
close remains below the 9-day moving average.

 

SUGAR MARKET RECAP

4/29/2004

July sugar opened unchanged on the session and
closed 30 higher on the day to re-capture a good portion of yesterday’s
collapse. Trade house buyers entered the market after it was clear that fund and
speculative selling was absent early in the session. The EU sold 70,000 tons of
white sugar at their weekly tender at a maximum rebate of 49.158 which was in
line with trade expectations. Dutch beet producers have planted 100,000 hectares
which is about 3% less acres this spring as compared with last year. May expires
on Friday. Russian imports appear to be picking up slightly after showing weak
import demand for much of this marketing year. Beginning stocks were thought to
be near a record high around 2.5 million tons. With speculators net long near
122,000 contracts in the last COT with options report, the market remains
vulnerable to long liquidation selling if support levels are violated.

Technical Outlook

#SUGAR (JUL) 4/30/2004: The close over the pivot
swing is a somewhat positive setup. Swing resistance comes in at 7.29, with
support found at 6.63. The downside crossover of the 9 & 18 bar moving average
is a negative signal. Stochastics trending lower at midrange will tend to
reinforce a move lower especially if support levels are taken out. The next
downside target is now at 6.63.

 

COTTON MARKET RECAP

4/29/2004

July and December cotton were down sharply at
mid-session but recovered to close just slightly lower on the day. Weekly export
sales came in at 93,500 bales as compared with trade expectations at
100,000-150,000 bales. Old crop sales were 48,200 bales as compared with 35,900
bales necessary each week to reach the USDA projection. Cumulative sales have
reached 95.8% of the USDA forecast for the season as compared with 98.8% on
average for this time of the year. Export shipments for the week reached 351,000
bales as compared with expectations at 300,000-350,000 bales. The CotLook A
Index was down 95 points to 69.05 which is now down 105 points for the week.

Technical Outlook

#COTTON (JUL) 4/30/2004: A negative signal for
trend short-term was given on a close under the 9-bar moving average. The market
tilt is slightly negative with the close under the pivot. Next resistance area
comes in at 61.03 and then again at 62.14, while support is targeted at 57.73
and 55.54. Momentum studies trending lower at mid-range could accelerate a price
break if support levels are broken. The next downside objective is 55.54.