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BBQ-ing The Meats

  • November 9, 2001
  • Marc Dupee

Meat contracts are
breaking down, resuming downtrends.

December
live cattle
(
LCZ1 |
Quote |
Chart |
News |
PowerRating) touched down to a contract low
yesterday, indicating technical weakness. Jan. ’02 feeder cattle

(
FCX1 |
Quote |
Chart |
News |
PowerRating) are the leading contract on the
Implosion-5 List, and live cattle is also a member. Both contracts are
eligible for an Off The Blocks
 short and are making good on the entry setup as they trade to fresh
lows. 

December lean hogs
(
LHZ1 |
Quote |
Chart |
News |
PowerRating), mentioned as a contract likely to
trade lower due to support in the 51.650 area in last night’s Futures Report,
are down their daily limit. February 2002 pork bellies
(
PBG2 |
Quote |
Chart |
News |
PowerRating)
are down nearly their limit.  

S&P futures
(
SPZ1 |
Quote |
Chart |
News |
PowerRating) started lower, dropping
over 10 handles, but have retraced and are approaching session highs again.
There are six down arrows on the Market
Bias Indicators Page, which was your early indication of a possible sell-off
this morning and also suggests the market will pull back from overhead
resistance. 

In a third explosive up day, December cocoa
(
CCZ1 |
Quote |
Chart |
News |
PowerRating) is
up another 5%. This contract whipsawed around the opening range on the open
but held at the 38.2% retracement of yesterday’s close to the morning high.
This is the market’s highest weekly close since February. Be cautious of the
gaps underneath… 

January soybeans
(
SF2 |
Quote |
Chart |
News |
PowerRating) continue
to thrash around the handle of their low-level cup-and-handle pattern. But
the subtly higher lows and highs suggests beans will crack resistance and
move more significantly into the overhead gap. 

Energies are up in volatile trade, filling the 10/31
gap. The market is responding to OPEC’s threat to cut output more
substantially than previously stated. Word from Russia that they will change
their stance and cut their output is also supporting energies. This
represents a shift in the view of the market. Non-OPEC nations had earlier
stated they would continue with the same output despite OPEC pleas to limit
global supply to drive prices higher.Â