Gold And Silver Impressive — Here’s Why
BOND MARKET RECAP
9/29/2004
December Bonds closed down 0-28 at 112-20. This
was 0-05 up from the low and 0-21 off the high.
December 10 Yr Treasury Notes finished down 0-190
at 112-250, 0-140 off the high and 0-030 up from the low.
The Treasury market fell sharply after a
major Bond fund managed predicted that interest rates were set to rise. We also
think that some of the early selling was simply the result of the slight upward
adjustment in the US GDP reading. However, with a number of critical chart
support levels violated and the energy complex weakening the outlook for the
bear camp improved. In fact, one might suggest that the overall economic outlook
improved and that justified the washout in bonds and notes. The trade is also
expecting slightly favorable economic readings on Thursday and that could have
added to the liquidation tilt.
Technical Outlook
BONDS (DEC) 09/30/2004: Daily stochastics turning
lower from overbought levels is bearish and will tend to reinforce a downside
break especially if near-term support is penetrated. The close below the 9-day
moving average is a negative short-term indicator for trend. The defensive
setup, with the close under the 2nd swing support, could cause some early
weakness. The next downside target is now at 111-21. The next area of resistance
is around 113-05 and 114-00, while 1st support hits today at 112-00 and below
there at 111-21.
TNOTES (DEC) 09/30/2004: Momentum studies
trending lower at mid-range could accelerate a price break if support levels are
broken. The close below the 9-day moving average is a negative short-term
indicator for trend. The market is in a bearish position with the close below
the 2nd swing support number. The next downside target is now at 112-065. The
next area of resistance is around 113-080 and 113-240, while 1st support hits
today at 112-155 and below there at 112-065.
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STOCK INDICES RECAP
9/29/2004
December S&P finished up 5.5 at 1115.2, 0.2
off the high and 7.9 up from the low.
December S&P E-Mini closed up 5.5 at 1115.25.
This was 8 up from the low and 0.25 off the high.
December Dow closed up 60 at 10125. This was 84
up from the low and 2 off the high.
December Dow E-Mini finished up 59 at 10124, 3
off the high and 83 up from the low.
The stock market traded in a very tight range
Wednesday despite the fact that a series of favorable fundamental developments
were seen. In other words, the stock market could have justified a sharp
extension of the recovery from the prior day’s lows but instead the market
waffled. It is possible that the stock market is skeptical of a temporary
decline in energy prices and views the recent US GDP report as an old report. In
any regard, the stock market could have acted much more impressively but
didn’t have the speculative interest.
Technical Outlook
S&P 500 (DEC) 09/30/2004: Stochastics
trending lower at midrange will tend to reinforce a move lower especially if
support levels are taken out. The market’s close below the 9-day moving average
is an indication the short-term trend remains negative. Market positioning is
positive with the close over the 1st swing resistance. The next downside target
is 1105.18. The next area of resistance is around 1119.25 and 1121.37, while 1st
support hits today at 1111.15 and below there at 1105.18.
SP EMINI (DEC) 09/30/2004: Negative momentum
studies in the neutral zone will tend to reinforce lower price action. The
market’s close below the 9-day moving average is an indication the short-term
trend remains negative. The close over the pivot swing is a somewhat positive
setup. The next downside target is 1105.07. The next area of resistance is
around 1119.37 and 1121.56, while 1st support hits today at 1111.13 and below
there at 1105.07.
NASDAQ (DEC) 09/30/2004: Momentum studies
trending lower at mid-range could accelerate a price break if support levels are
broken. A positive signal for trend short-term was given on a close over the
9-bar moving average. There could be more upside follow through since the market
closed above the 2nd swing resistance. The next downside target is 1385.63. The
next area of resistance is around 1427.75 and 1434.62, while 1st support hits
today at 1403.25 and below there at 1385.63.
MINIDOW (DEC) 09/30/2004: The cross over and
close above the 40-day moving average is an indication the longer-term trend has
turned positive. The crossover up in the daily stochastics is a bullish signal.
Rising from oversold levels, daily momentum studies would support higher prices,
especially on a close above resistance. The market’s short-term trend is
positive on the close above the 9-day moving average. The market has a slightly
positive tilt with the close over the swing pivot. The near-term upside target
is at 10190. The next area of resistance is around 10167 and 10190, while 1st
support hits today at 10081 and below there at 10018.
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CURRENCY MARKET RECAP
9/29/2004
December US Dollar finished up 2 at 8829, 21 off
the high and 18 up from the low.
December Euro finished up 0.03 at 123.23, 0.17
off the high and 0.4 up from the low.
December Euro Dollar closed down 0.02 at 97.695.
This was 0.01 up from the low and 0.01 off the high.
December Canadian Dollar closed unchanged at
78.55. This was 0.09 up from the low and 0.25 off the high.
December British Pound finished down 1.23 at
178.94, 0.88 off the high and 0.37 up from the low.
December Swiss closed down 0.03 at 79.62. This
was 0.31 up from the low and 0.16 off the high.
December Japanese Yen closed up 0.43 at 90.57.
This was 0.18 up from the low and 0.14 off the high.
The Dollar wasn’t move significantly by the
upward revision in the US GDP probably because the reading is an old reading and
partly because the jury is still out on the ultimate direction in the US
economy. However, with US energy prices softening considerably and the
expectation for more good US numbers on Thursday we can understand the profit
taking action in the Pound and the Swiss. We suspect that the Swiss liquidation
was mostly because the flight to quality impetus in the market was significantly
reduced from the levels seen early in the week. With crude oil retracing from
the $50 level, there is less international flight to quality interest imputed
into the Swiss and that could be why the Swiss was under pressure.
Technical Outlook
YEN (DEC) 09/30/2004: Daily stochastics declining
into oversold territory suggest the selling may be drying up soon. The market’s
short-term trend is negative as the close remains below the 9-day moving
average. If yesterday’s gap higher on the day session chart holds, additional
buying could develop this session. The market has a bullish tilt coming into
today’s trade with the close above the 2nd swing resistance. The next downside
objective is now at 90.24. The next area of resistance is around 90.72 and
90.88, while 1st support hits today at 90.41 and below there at 90.24.
EURO (DEC) 09/30/2004: Daily stochastics have
risen into overbought territory which will tend to support reversal action if it
occurs. The market’s short-term trend is positive on the close above the 9-day
moving average. The upside closing price reversal on the daily chart is somewhat
bullish. With the close higher than the pivot swing number, the market is in a
slightly bullish posture. The next upside objective is 123.74. The next area of
resistance is around 123.51 and 123.74, while 1st support hits today at 122.95
and below there at 122.61.
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PRECIOUS METALS RECAP
9/29/2004
December Gold closed up 0.5 at 414.7. This was
1.4 up from the low and 1.5 off the high.
December Silver finished up 0.085 at 6.695, 0.055
off the high and 0.1 up from the low.
October Platinum closed down 30.5 at 846.5. This
was 1.5 up from the low and 11.5 off the high.
The gold and silver market were impressive in
their action Wednesday, not because of the magnitude of price gains but because
they rallied in the face of a strong Dollar and slumping energy prices. In other
words, the metals markets showed signs of climbing off the expectation of
physical demand. In fact, some traders are suggesting that the funds came in
because of chart points while other suggested that strong gains in copper and a
good GDP reading from the US sparked the talk about increased physical demand
for silver and gold. In any regard, it is much healthier for gold and silver to
rally off physical demand hopes than to derive speculative interest from a
falling Dollar or other wild economic conditions.
Technical Outlook
SILVER (DEC) 09/30/2004: Rising stochastics at
overbought levels warrant some caution for bulls. The market’s short-term trend
is positive on the close above the 9-day moving average. The market setup is
supportive for early gains with the close over the 1st swing resistance. The
next upside objective is 683.9. The market is approaching overbought levels with
an RSI over 70. The next area of resistance is around 677.3 and 683.9, while 1st
support hits today at 661.8 and below there at 652.9.
GOLD (DEC) 09/30/2004: Daily stochastics have
risen into overbought territory which will tend to support reversal action if it
occurs. The market’s short-term trend is positive on the close above the 9-day
moving average. With the close higher than the pivot swing number, the market is
in a slightly bullish posture. The next upside target is 417.6. The next area of
resistance is around 416.1 and 417.6, while 1st support hits today at 413.3 and
below there at 411.9.
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COPPER MARKET RECAP
9/29/2004
December Copper finished up 2.35 at 139.30, 0.30
off the high and 2.20 up from the low.
The copper market continues to grind upward even
when economic conditions are suspect. On Wednesday the market actually saw
favorable GDP readings from the US, lower energy prices and saw ongoing talk
about strong Chinese demand. Therefore, it is not surprising that fund interest
piled into the long side of the market. Copper gains over the last three months
have been held back by the macro economic case and the move to 140 suggests that
physical demand for copper is set to tighten inventories even further.
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ENERGY MARKET RECAP
9/29/2004
December Crude Oil closed down 0.28 at 48.91.
This was 1.01 up from the low and 0.64 off the high.
December Heating Oil closed down 0.63 at 137.86.
This was 2.86 up from the low and 1.44 off the high.
December Unleaded Gas finished down 1.41 at
130.99, 2.01 off the high and 2.49 up from the low.
December Natural Gas finished up 0.54 at 7.56,
0.24 off the high and 0.26 up from the low.
December Propane closed down 0.01 at 0.84. This
was 0.00 up from the low and equal to the high.
The energy complex sagged slightly after the
weekly inventory readings failed to provide the bull case an additional lift.
The weekly inventory reports showed builds in excess of 3.4 million barrels
while gasoline stocks at both the EIA and API showed minimal declines. The
refinery rates surprisingly remained low and that provides some support to the
market. However, with news that the Nigerian Rebel leader was considering a
Peace deal, the energy market decided to remove some speculative premium from
crude and gasoline prices. With another portion of Yukos sold, the Nigerian
situation calming and the weather support for energy prices waning the bull camp
is finally under the gun. We suspect that sharp gains in natural gas prices was
the result of forward buying and a residual impact off the last bulge up in
crude prices.
Technical Outlook
CRUDE OIL (DEC) 09/30/2004: The rally brought the
market to a new contract high. Daily stochastics have risen into overbought
territory which will tend to support reversal action if it occurs. The market’s
close above the 9-day moving average suggests the short-term trend remains
positive. The daily closing price reversal down puts the market on the
defensive. It is a slightly negative indicator that the close was under the
swing pivot. The next upside target is 50.46. The market is becoming somewhat
overbought now that the RSI is over 70. The next area of resistance is around
49.73 and 50.46, while 1st support hits today at 48.09 and below there at 47.17.
UNLEADED (DEC) 09/30/2004: A new contract high
was made on the rally. Studies are showing positive momentum but are now in
overbought territory, so some caution is warranted. The market’s close above the
9-day moving average suggests the short-term trend remains positive. The market
could take on a defensive posture with the daily closing price reversal down.
The market setup is somewhat negative with the close under the 1st swing
support. The next upside objective is 135.37. The next area of resistance is
around 133.23 and 135.37, while 1st support hits today at 128.74 and below there
at 126.37.
HEATING OIL (DEC) 09/30/2004: A new contract high
was made on the rally. Rising stochastics at overbought levels warrant some
caution for bulls. The market’s short-term trend is positive on the close above
the 9-day moving average. The downside closing price reversal on the daily chart
is somewhat negative. The market tilt is slightly negative with the close under
the pivot. The near-term upside target is at 141.80. The 9-day RSI over 70
indicates the market is approaching overbought levels. The next area of
resistance is around 140.01 and 141.80, while 1st support hits today at 135.71
and below there at 133.21.
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CORN MARKET RECAP
9/29/2004
December Corn finished down 1 1/4 at 207
1/4, 3 off the high and 1/2 up from the low. March Corn closed down 1 1/2 at
218. This was 1/4 up from the low and 3 off the high.
Talk of cold weather on the weekend which could
end the growing season in the northern cornbelt helped to support the early
gains and strength in the soybean complex and wheat provided additional support
but the lower close leaves a bearish tilt to the technical picture.
Short-covering from the oversold condition and follow-through technical buying
was also seen as supportive. Trade estimates for potential damage from a frost
early this week (after the weekly crop progress report on Monday) were near
150-400 million bushels and with one more week until a hard freeze might hit (if
it occurs on the weekend or early next week) the damage estimates will likely be
below these estimates. Positioning ahead of the USDA September 1st stocks report
has also impacted trade with talk of hefty domestic demand in the past quarter.
Gulf basis was steady to lower and traders remain concerned with the markets
ability to absorb a record crop in the weeks just ahead. For the weekly export
sales report, also released before the opening, traders are looking for corn
sales near 800,000-1.05 million tons as compared with 1.178 million tons last
week. Support for December corn comes in at 206 and 204 1/2 with 212 3/4 and 215
as resistance.
Technical Outlook
CORN (DEC) 09/30/2004: The stochastic indicator
is rising from oversold levels, which is bullish and should support higher
prices. The market’s short-term trend is negative as the close remains below the
9-day moving average. The market could take on a defensive posture with the
daily closing price reversal down. The market’s close below the pivot swing
number is a mildly negative setup. The next upside target is 211 1/4. Some
caution in pressing the downside is warranted with the RSI under 30. The next
area of resistance is around 209 and 211 1/4, while 1st support hits today at
205 1/2 and below there at 204 1/2.
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SOY COMPLEX RECAP
9/29/2004
November Soybeans finished up 2 at 533 1/2, 6 off
the high and 1/2 up from the low. January Soybeans closed up 1 1/4 at 540 3/4.
This was 1/4 up from the low and 6 3/4 off the high.
December Soymeal closed up 0.7 at 162.3. This was
0.2 up from the low and 1.2 off the high.
December Soybean Oil finished down 0.01 at 20.82,
0.37 off the high and 0.02 up from the low.
Some light frost in portions of the upper Midwest
overnight and fears of a hard freeze to end the growing season in the northern
cornbelt this weekend helped support the early buying. In addition,
follow-through technical buying and short-covering from the reversal on Monday
and ahead of the end of the month and ahead of the USDA September 1st Grain
Stocks report for Thursday morning added to the positive tone. Frost could harm
some of the crop which has not reached maturity for the cold front due to hit on
Saturday. In addition to the stocks report, the Census crush report may cause
some volatility for the markets tomorrow. Last nights lows reached 32 degrees
and a bit lower in parts of Iowa but the trade is more concerned with cold
weather forecast for the weekend and again for early next week. Traders believe
a frost this week would have damaged 15-30 million bushels but more of the crop
could reach maturity by the weekend or early next week. For the weekly export
sales report, also released before the opening, traders are looking for soybean
sales near 600,000-800,000 tons, 50,000-125,000 for meal and 4,000-8,000 tons
for oil. In addition to the speculative buying, commercial activity seems to be
picking up as well with talk of China interest in soybeans and commercial buying
noted in meal. Deliveries for first notice day (Thursday) for October meal are
expected to be 0-300 contracts with trade expectations for October oil at 0-500
contracts. Resistance for November soybeans comes in near 542 and 548 1/4 with
support at 534 1/2 and 530.
Technical Outlook
BEANS (NOV) 09/30/2004: Daily stochastics are
showing positive momentum from oversold levels, which should reinforce a move
higher if near-term resistance is taken out. A negative signal for trend
short-term was given on a close under the 9-bar moving average. The market has a
slightly positive tilt with the close over the swing pivot. The near-term upside
target is at 541 1/4. The 9-day RSI under 30 indicates the market is approaching
oversold levels. The next area of resistance is around 536 3/4 and 541 1/4,
while 1st support hits today at 530 1/4 and below there at 528 1/2.
MEAL (DEC) 09/30/2004: Daily stochastics are
showing positive momentum from oversold levels, which should reinforce a move
higher if near-term resistance is taken out. The close above the 9-day moving
average is a positive short-term indicator for trend. The gap up on the day
session chart gave a bullish indicator and more follow through could be seen
this session. A positive setup occurred with the close over the 1st swing
resistance. The next upside objective is 163.9. Consider buying pull-backs since
daily studies are bullish. The next area of resistance is around 163.0 and
163.9, while 1st support hits today at 161.6 and below there at 161.2.
BEANOIL (DEC) 09/30/2004: The crossover up in the
daily stochastics is a bullish signal. Daily momentum studies are on the rise
from low levels and should accelerate a move higher on a push through the 1st
swing resistance. A negative signal for trend short-term was given on a close
under the 9-bar moving average. The daily closing price reversal down puts the
market on the defensive. The market’s close below the pivot swing number is a
mildly negative setup. The next upside objective is 21.29. Some caution in
pressing the downside is warranted with the RSI under 30. The next area of
resistance is around 21.01 and 21.29, while 1st support hits today at 20.63 and
below there at 20.52.
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WHEAT MARKET RECAP
9/29/2004
December Wheat finished up 4 at 319 3/4, 1
3/4 off the high and 3 1/2 up from the low. March Wheat closed up 5 at 332 3/4.
This was 4 3/4 up from the low and 3/4 off the high.
Commercial buying and speculative short-covering
helped to provide early support and strength in the other grains added to the
positive tone. Ideas that the market was overbought after a ten cent break off
of Monday’s highs and reports of potential lower quality wheat in Canada once
the harvest advances was seen as supportive. Grain officials indicate that a
large portion of the crop could grade out as feedwheat helped support as well.
The USDA annual small grains report will be released Thursday which will include
an update on the size of the US 2004 wheat crop. Traders look for production to
come in near 2.108 billion bushels which will be down from the August USDA
forecast of 2.123 billion. For the weekly export sales report, also released
before the opening, traders are looking for corn sales near 800,000-1.05 million
tons as compared with 1.178 million tons last week. For the weekly export sales
report, also released before the opening, traders are looking for wheat sales
near 400,000-550,000 tons as compared with 414,100 tons last week. Support for
December wheat comes in at 318 and 315 with 322 1/2 and 326 1/4 as resistance.
Technical Outlook
WHEAT (DEC) 09/30/2004: The moving average
crossover down (9 below 18) indicates a possible developing short-term
downtrend. Daily stochastics declining into oversold territory suggest the
selling may be drying up soon. The close below the 9-day moving average is a
negative short-term indicator for trend. The market has a slightly positive tilt
with the close over the swing pivot. The next downside objective is now at 314
1/4. The next area of resistance is around 322 1/4 and 324 1/2, while 1st
support hits today at 317 1/4 and below there at 314 1/4.
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LIVE CATTLE RECAP
9/29/2004
December Live Cattle closed up 0.15 at 86.80.
This was 0.30 up from the low and 1.45 off the high.
November Feeder Cattle finished up 0.65 at
110.12, 0.27 off the high and 0.97 up from the low.
The cattle market pushed sharply higher on the
session finding support from higher pork prices and a better demand tone from
packers. Slaughter was higher than expected on Tuesday which indicated better
demand from the packer and traders are hopeful that a pick-up in demand will
help clear-up the hefty upfront supply. The firm demand, however, will need to
remain for some time to assume a better demand trend as weak demand last week
led to a slow weekly slaughter and weights are already high. Boxed-beef cutout
values (600-750 choice) were down $.31 on the day at mid-session to $137.72 as
compared with $137.96 last week at this time.
Technical Outlook
CATTLE (DEC) 09/30/2004: A negative indicator was
given with the downside crossover of the 9 & 18 bar moving average. Momentum
studies trending lower at mid-range should accelerate a move lower if support
levels are taken out. The market’s short-term trend is negative as the close
remains below the 9-day moving average. With the close higher than the pivot
swing number, the market is in a slightly bullish posture. The next downside
objective is now at 85.350. The next area of resistance is around 87.670 and
88.820, while 1st support hits today at 85.950 and below there at 85.350.
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LEAN HOGS RECAP
9/29/2004
December Lean Hogs closed up 0.75 at 68.57. This
was 0.77 up from the low and 0.82 off the high.
February Pork Bellies finished up 1.77 at 96.72,
0.62 off the high and 2.92 up from the low.
The discount of futures to the cash market and
ideas that the market had already experienced a significant correction off of
last weeks highs helped to trigger renewed buying in the hog market. Cash hogs
were reported to be $1.00 lower at Peoria but with the 2-Day lean index coming
in higher, the market believes the futures are holding too much of a discount to
the cash market. The CME 2-Day Lean index for the period ending September 27th
came in at 80.61 which was up $.45 from the previous session and up from 77.08
on September 15th. This leaves December hogs at a significant discount to the
cash market. In addition, the USDA reported that for the week ending September
25th, average hog slaughter weights for Iowa/Minnesota were 262.1 pounds as
compared with 263.7 the previous week and 261.3 pounds last year at this time.
The sharp drop in weights in just one week is considered supportive and suggests
that producers are more current with marketings.
Technical Outlook
HOGS (DEC) 09/30/2004: Momentum studies are
trending lower from high levels which should accelerate a move lower on a break
below the 1st swing support. The market’s close below the 9-day moving average
is an indication the short-term trend remains negative. With the close higher
than the pivot swing number, the market is in a slightly bullish posture. The
next downside objective is 67.000. The next area of resistance is around 69.370
and 70.170, while 1st support hits today at 67.800 and below there at 67.000.
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COCOA MARKET RECAP
9/29/2004
December Cocoa finished up 4 at 1449, 4 off the
high and 18 up from the low.
The cocoa market once again failed at support but
it was clear that the buyers were willing to come in for some forward coverage.
We thought that cocoa prices were discounting too much of the potential damage
to the African crop and we have to think that the low forged Wednesday is to be
considered a solid low. With reports of crop problems (so far unverified) in
Indonesia, Ivory Coast and Ghana we have to think that the period of highest
supply will not drive prices down was many traders expect. Industry buying
around the lows Wednesday suggests that the commercial or professional trade
sees value recent prices. The Press suggested that increased manufacturing
demand was behind the buying interest in cocoa and that makes sense given the
relative price level in cocoa and the potential realization of crop problems in
the coming months.
Technical Outlook
COCOA (DEC) 09/30/2004: Momentum studies are
declining, but have fallen to oversold levels. The market’s short-term trend is
negative as the close remains below the 9-day moving average. The daily closing
price reversal up on the daily chart is somewhat positive. The market tilt is
slightly negative with the close under the pivot. The next downside target is
1424. The next area of resistance is around 1460 and 1467, while 1st support
hits today at 1438 and below there at 1424.
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COFFEE MARKET RECAP
9/29/2004
December Coffee closed up 1.30 at 82.40. This was
1.90 up from the low and 0.30 off the high.
The coffee market closed moderately higher and
recovered part of Tuesday’s sharp losses as there was a lack of new selling when
December futures matched the lowest price since September 17th. There was a
sense from the trade that the forecasts rains in Brazil for the weekend and
early next week will need to be seen before the market will assume that a decent
flowering period will occur ahead. Brazil traders believe that after the
extended period of dry weather and plenty of stress on the trees after the large
harvest that the rains will need to be widespread and even to see a good
flowering period ahead. While London November futures are in the middle of a
2-month trading range, New York futures are just off of the highs and a good
rain even could trigger significant selling in New York soon.
Technical Outlook
COFFEE (DEC) 09/30/2004: Momentum studies
trending lower from overbought levels is a bearish indicator and would tend to
reinforce lower price action. The close above the 9-day moving average is a
positive short-term indicator for trend. The upside closing price reversal on
the daily chart is somewhat bullish. With the close higher than the pivot swing
number, the market is in a slightly bullish posture. The next downside objective
is now at 79.80. The next area of resistance is around 83.50 and 84.20, while
1st support hits today at 81.30 and below there at 79.80.
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SUGAR MARKET RECAP
9/29/2004
October Sugar closed up 0.11 at 8.39. This was
0.11 up from the low and 0.09 off the high.
March closed 5 higher on the session but down 12
from the early highs as late weakness in London futures and some long
liquidation from speculators helped to trigger the late sell-off. October
futures managed to push moderately higher and to the highest level for the
nearby futures since March of 2003. October expires on Thursday and open
interest (as of September 28th) was down 5,137 to 17,324 contracts. In addition
to talk of India buying this week, talk of interest from Mexico and Iraq added
to the positive tone.
Technical Outlook
SUGAR (MAR) 09/30/2004: The market made a new
contract high on the rally. The upside crossover of the 9 & 18 bar moving
average is a positive signal. Momentum studies are trending higher but have
entered overbought levels. A positive signal for trend short-term was given on a
close over the 9-bar moving average. The close over the pivot swing is a
somewhat positive setup. The next upside objective is 9.15. The next area of
resistance is around 9.05 and 9.15, while 1st support hits today at 8.91 and
below there at 8.86.
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COTTON MARKET RECAP
9/29/2004
October Cotton finished up 0.25 at 48.20, 1.15
off the high and 0.60 up from the low.
The outlook for sunny weather for most days in
the next week for much of the cotton producing areas was enough to trigger more
selling and a moderately lower close for cotton. Speculative selling led the
market down and there is a lack of commercial buying support underneath the
market on the early weakness. Traders are hopeful that as the harvest of the
record crop picks up in the next month that export activity will also pick up to
help provide some offsetting support to the commercial selling which normally
occurs into harvest. For the weekly export sales report, released before the
opening, traders are looking for sales near 150,000-200,000 bales as compared
with 140,000 bales last week. Shipments are expected near 50,000-80,000 bales
from 66,300 bales last week.
Technical Outlook
COTTON (DEC) 09/30/2004: Daily stochastics are
trending lower but have declined into oversold territory. A negative signal for
trend short-term was given on a close under the 9-bar moving average. The market
setup is somewhat negative with the close under the 1st swing support. The next
downside objective is now at 46.12. The next area of resistance is around 47.53
and 48.11, while 1st support hits today at 46.53 and below there at 46.12.