Chill Warms Nat Gas

  • November 13, 2000
  • Marc Dupee

A cold snap forecast for much of the
country–particularly heavy-consuming regions–sparked a rally in natural gas
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that left it at its second highest close ever. Nat gas is the leading contract
on the Momentum-5
List and finished up .242 at 5.698.

Comments from OPEC that it will curb additional
supplies to the world market brought buyers back into the pits. December crude oil
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List, rallied .45 to 34.47 and .0088 to 1.0163 respectively. 

Following on the heels of Dell’s disappointing earnings
last week, technology bellwether Hewlett-Packard reinvigorated the negative
argument in tech and  broke the Nasdaq 100 cash index to a one-year
low. 

Nasdaq 100 futures
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the chin through limit down levels and a one-year low, but staged an impressive
recovery only to be thwarted from additional upside after former Secretary of
State Warren Christopher created more uncertainty about the election results.
NDZ0 closed down 66.50 at 2827.50 after a positive reading. S&Ps
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and
Dow futures
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66.50, respectively.  

Moving in opposite but nearly equal steps with the stock
index futures, T-bonds
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for funds and bought the perceived safety of Treasuries. T-bonds closed up
15/32, at 99 21/32.

The decline in equities hurt the dollar.
December dollar index futures
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115.55. Interestingly and indicative of the continuing weakness in the euro (and
belief that the ECB would not intervene for a fourth time in a week on a down
stock market day) is the negative showing in the Euro FX
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which closed down .00090 at .86190.

Copper
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to its worst close in four months as declines in major global stock markets
curbed buyers’ appetites to purchase the industrial metal futures. Copper was a

Pullback From Lows
setup and traded sideways and slightly higher after a big gap-down opening.
December finished 1.75 lower at 82.10.

December gold
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the contract’s
Implosion-5 List
reading implies additional downside, the uncertainty of the US elections could
spur a flight to safety move. An explosive move is in store for this contract:
it is a Multiple Days Low
Volatility List
 member, so look to play this contract on a break either up or down out of
its narrow-range-at-low pattern. 

Also in the metals,
silver
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signal, falling 3.5 to 468.


This morning’s Pre-Opening cocoa commentary summed up the situation in
cocoa prior to its moving to a new low in Monday’s session:

Speculative selling, which is likely small-trader long-liquidation, continues
to hit the cocoa market. Buyers’ needs appear to be covered and the Ivory Coast
crop continues to move to the market with the harvest expected to get into full
swing by early December and January. With the market already weak and in a long
liquidation phase, the strong US dollar and weak CRB Index yesterday only added
to the negative sentiment. Cocoa
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the
New 10-Day Low List, and hinted it could make a larger-than-normal move by
registering on the 6/100 Low Volatility
List. Cocoa drops seasonally in times of a bumper harvest. Cocoa fell to a
25-year low, down 21 at 209.

Also in the softs, coffee presaged a drop with its
negative Implosion-5
List reading. Its Multiple Days Low
Volatility List signal also implied that coffee
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could make a larger-than-normal move as the contract’s recent high volatility
reverted to its mean (to its 100-day average volatility). Rain in the world’s
largest grower of coffee, Brazil, as well as forecasts for more rain ahead,
pressured the Dec. contract to fresh lows that are approaching a seven-year
record, down 2.70 at 71.45. Watch this contract above 72.55, as coffee sets up
Tuesday in a Turtle Soup Plus One buy pattern.