Here’s What Is Significant About Today’s Move In Crude
BOND MARKET RECAP
10/27/2004
December Bonds closed down 1-04 at 113-02. This
was 0-03 up from the low and 1-16 off the high.
December 10 Yr Treasury Notes finished down 0-225
at 113-030, 0-285 off the high and 0-020 up from the low.
From the beginning of the session Treasury
prices failed to respond to potentially bullish developments. Energy prices
which were initially strong eventually fell aggressively, following a sharp
rebuilding of U.S. crude stocks. With a sharp decline in energy prices serving
to dramatically improve the outlook toward the economy it is not surprising that
prices fell. The durable-goods report showed eight a slightly less than expected
growth of two tenths of a percent and a downward revision the prior month’s
reading and that should haven given in bonds support early. However the second
set of numbers, home sales, showed a 3.5 percent gain and that also helped to
improved outlook for the economy. In the end, sharply lower energy prices,
somewhat favorable economic information and higher equity prices simply
justified the weakness in Treasury prices.
Technical Outlook
BONDS (DEC) 10/28/2004: The daily stochastics
have crossed over down which is a bearish indication. Momentum studies trending
lower from overbought levels is a bearish indicator and would 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 defensive setup, with the
close under the 2nd swing support, could cause some early weakness. The next
downside target is now at 111-24. The next area of resistance is around 113-27
and 115-01, while 1st support hits today at 112-07 and below there at 111-24.
TNOTES (DEC) 10/28/2004: A crossover down in the
daily stochastics is a bearish signal. 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 market is in a bearish
position with the close below the 2nd swing support number. The next downside
objective is now at 112-115. The next area of resistance is around 113-190 and
114-090, while 1st support hits today at 112-205 and below there at 112-115.
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STOCK INDICES RECAP
10/27/2004
December S&P finished up 13.3 at 1124.8, 1.7 off
the high and 17.9 up from the low.
December S&P E-Mini closed up 13.25 at 1124.75.
This was 18 up from the low and 2 off the high.
December Dow closed up 106 at 9987. This was 154
up from the low and 21 off the high.
December Dow E-Mini finished up 106 at 9987, 21
off the high and 154 up from the low.
The stock-market understandably performed well in
the action on Wednesday, primarily because of the significant decline in energy
prices and because of the slightly better than expected U.S. home sales data.
One might have considered the durable-goods gain of two tenths of a percent to
be a little disappointing, especially when one acknowledges the prior month’s
downward revision but the market was of a mind to look for the positives. In
order for stock prices to extend the short-covering bounce, it will be necessary
to push energy prices even lower, which could give the impression of a major top
in energy prices. While there was also a slight flow of favorable corporate
news, it’s apparent that the energy price action was the main catalysts in the
trade Wednesday.
Technical Outlook
S&P 500 (DEC) 10/28/2004: The cross over and
close above the 40-day moving average indicates the longer-term trend has turned
up. Momentum studies are trending higher from mid-range, which should support a
move higher if resistance levels are penetrated. The close above the 9-day
moving average is a positive short-term indicator for trend. There could be more
upside follow through since the market closed above the 2nd swing resistance.
The next upside target is 1140.34. The next area of resistance is around 1134.59
and 1140.34, while 1st support hits today at 1115.00 and below there at 1101.15.
SP EMINI (DEC) 10/28/2004: The major trend could
be turning up with the close back above the 40-day moving average. Positive
momentum studies in the neutral zone will tend to reinforce higher price action.
The market’s close above the 9-day moving average suggests the short-term trend
remains positive. Market positioning is positive with the close over the 1st
swing resistance. The near-term upside target is at 1140.75. The next area of
resistance is around 1134.75 and 1140.75, while 1st support hits today at
1114.75 and below there at 1100.75.
NASDAQ (DEC) 10/28/2004: The market rallied to a
new contract high. The moving average crossover up (9 above 18) indicates a
possible developing short-term uptrend. A bullish signal was given with an
upside crossover of the daily stochastics. Momentum studies are trending higher
from mid-range, which should support a move higher if resistance levels are
penetrated. 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 near-term upside target is at
1519.25. The next area of resistance is around 1503.50 and 1519.25, while 1st
support hits today at 1455.50 and below there at 1423.25.
MINIDOW (DEC) 10/28/2004: Momentum studies are
trending higher from mid-range, which should support a move higher if resistance
levels are penetrated. The market’s short-term trend is positive on the close
above the 9-day moving average. Market positioning is positive with the close
over the 1st swing resistance. The near-term upside target is at 10128. The next
area of resistance is around 10074 and 10128, while 1st support hits today at
9900 and below there at 9779.
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CURRENCY MARKET RECAP
10/27/2004
December US Dollar finished up 26 at 8555, 7 off
the high and 65 up from the low.
December Euro finished down 0.48 at 127.02, 1.1
off the high and 0.07 up from the low.
December Euro Dollar closed down 0.04 at 97.68.
This was 0.015 up from the low and 0.04 off the high.
December Canadian Dollar closed down 0.08 at
81.46. This was 0.14 up from the low and 0.66 off the high.
December British Pound finished down 0.63 at
182.23, 1.52 off the high and 0.23 up from the low.
December Swiss closed down 0.38 at 82.94. This
was 0.05 up from the low and 0.86 off the high.
December Japanese Yen closed up 0.17 at 94.13.
This was 0.26 up from the low and 0.26 off the high.
After the action on Wednesday, it’s apparent that
a significant portion of the downward pressure in the Dollar over the last two
weeks was in fact coming from the ultra high energy price situation. It’s still
a little surprising that the Dollar managed to rally, considering that the
durable-goods report was a somewhat soft but a stronger than expected and home
sales reading balanced out the economic report flow for the day. A return to be
85.94 in the Dollar index would simply fill the gap left by the big downward
thrust early in the week and that action would not necessarily signal an overall
change in the trend. Furthermore, it is yet to be proven whether energy prices
will managed to stay down from their recent highs.
Technical Outlook
YEN (DEC) 10/28/2004: Momentum studies are
trending higher but have entered overbought levels. The market’s close above the
9-day moving average suggests the short-term trend remains positive. The close
over the pivot swing is a somewhat positive setup. The next upside objective is
94.65. The market is approaching overbought levels with an RSI over 70. The next
area of resistance is around 94.39 and 94.65, while 1st support hits today at
93.87 and below there at 93.61.
EURO (DEC) 10/28/2004: The daily stochastics have
crossed over down which is a bearish indication. 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 market’s close above the
9-day moving average suggests the short-term trend remains positive. The close
below the 1st swing support could weigh on the market. The next downside
objective is 126.11. The next area of resistance is around 127.60 and 128.44,
while 1st support hits today at 126.44 and below there at 126.11.
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PRECIOUS METALS RECAP
10/27/2004
December Gold closed down 2 at 425.6. This was
1.4 up from the low and 4.5 off the high.
December Silver finished down 0.138 at 7.202,
0.243 off the high and 0.032 up from the low.
January Platinum closed down 8.7 at 836.2. This
was 1.2 up from the low and 10.3 off the high.
Understandably both gold and silver prices came
under aggressive pressure as energy prices declined and the U.S. Dollar mounted
a recovery. Seeing energy prices declined considerably, would certainly reduce
economic uncertainty, which in turn could reduce investment flow into gold and
silver. In the recent past, Energy prices have of dipped temporarily but have
not sustained downside action and in order to really undermine gold and silver,
the energy market will have to be presented with persistently lower prices. In
the coming sessions, gold and silver will show that they have indeed been
carried somewhat by the escalating concern for the global economy off the energy
threat. Furthermore dramatically deflate the bull case in gold, the December
Dollar Index might have to climb back to the critical 85.94 level.
Technical Outlook
SILVER (DEC) 10/28/2004: A crossover down in the
daily stochastics is a bearish signal. 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 market’s short-term trend is
negative as the close remains below the 9-day moving average. The outside day
down and close below the previous day’s low is a negative signal. The close
below the 1st swing support could weigh on the market. The next downside target
is 698.0. Daily studies pointing down suggests selling minor rallies. The next
area of resistance is around 734.0 and 753.0, while 1st support hits today at
706.5 and below there at 698.0.
GOLD (DEC) 10/28/2004: A crossover down in the
daily stochastics is a bearish signal. Momentum studies are trending lower from
high levels which should accelerate a move lower on a break below the 1st swing
support. A positive signal for trend short-term was given on a close over the
9-bar moving average. The outside day down is somewhat negative. It is a
slightly negative indicator that the close was under the swing pivot. The next
downside target is 420.5. The next area of resistance is around 428.5 and 432.2,
while 1st support hits today at 422.7 and below there at 420.5.
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COPPER MARKET RECAP
10/27/2004
December Copper finished up 0.65 at 128.80, 0.70
off the high and 1.30 up from the low.
Copper prices stood up against liquidation in the
precious metals sector Wednesday and did so because the forward look on the
economy improved. With crude-oil prices falling by as much as $2.50 a barrel in
the action on Wednesday, it’s understandable that the outlook for the global
economy was upgraded. However December copper would still seem to have
significant overhead consolidation resistance at 133 and a single-day decline in
energy prices doesn’t necessarily signal an end to the bull market in energy
prices. So far, the market has not benefited from the threat of a strike in
Peru, but if the macroeconomic outlook improves further, the copper market might
decide to reconsider the bullishness of the labor issue.
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ENERGY MARKET RECAP
10/27/2004
December Crude Oil closed down 2.71 at 52.46.
This was 0.36 up from the low and 3.19 off the high.
December Heating Oil closed down 7.13 at 150.52.
This was 1.02 up from the low and 9.28 off the high.
December Unleaded Gas finished down 7.56 at
134.59, 8.11 off the high and 1.09 up from the low.
December Natural Gas finished down 0.59 at 8.78,
0.66 off the high and 0.04 up from the low.
December Propane closed down 0.01 at 0.95. This
was equal to the low and 0.01 off the high.
The energy complex initially ran to new highs in
the day but then reversed course aggressively in the wake of significant
rebuilding of US crude stocks. With over 5 million barrels put into API stocks
and a similarly large total seen into the DOE, is clear that some of the
tightness has been mitigated. Gasoline stocks also showed a minor build, which
added to the bearish psychology. While distillate stocks did post another 2
million barrel decline the trade evidently took the crude stocks information as
the most dominating item of the day. While crude oil prices have shown many
significant daily ranges over the last four months, the range Wednesday was
quite prolific and that could be a sign of a correction similar in scope to the
one seen in August.
Technical Outlook
CRUDE OIL (DEC) 10/28/2004: The market made a new
contract high on the rally. Stochastics turning bearish at overbought levels
will tend to support lower prices if support levels are broken. The market’s
short-term trend is negative as the close remains below the 9-day moving
average. The outside day down and close below the previous day’s low is a
negative signal. The defensive setup, with the close under the 2nd swing
support, could cause some early weakness. The next downside objective is now at
49.62. The next area of resistance is around 54.23 and 56.71, while 1st support
hits today at 50.69 and below there at 49.62.
UNLEADED (DEC) 10/28/2004: Negative momentum
studies in the neutral zone will tend to reinforce lower price action. A
negative signal for trend short-term was given on a close under the 9-bar moving
average. The outside day down and close below the previous day’s low is a
negative signal. There could be some early pressure today given the market’s
negative setup with the close below the 2nd swing support. The next downside
objective is now at 127.15. The next area of resistance is around 139.19 and
145.54, while 1st support hits today at 129.99 and below there at 127.15.
HEATING OIL (DEC) 10/28/2004: 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. The outside day
down is a negative signal. The close below the 2nd swing support number puts the
market on the defensive. The next downside objective is now at 142.29. The next
area of resistance is around 155.67 and 162.88, while 1st support hits today at
145.37 and below there at 142.29.
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CORN MARKET RECAP
10/27/2004
December Corn finished down 1/2 at 206 1/4,
1 3/4 off the high and 3/4 up from the low. March Corn closed unchanged at 217
1/4. This was 1 up from the low and 1 1/4 off the high.
The move to a new high for the week failed to
attract new buying and the lower close leaves the market back into a trading
range. Rains slowed the harvest this week but yesterday’s storms were mostly
across the southern belt. However, a good rain with high winds expected for
Friday in the northwest cornbelt (where the harvest is the farthest behind)
could help support the market into the end of the month. The 6-10 day is also
wet. Gulf basis was steady. South Korea bought 52,500 tons of optional origin
corn overnight for the second day in a row. The bounce in wheat helped support
but weaker soybean values have limited the buying support. Brazil officials
pegged the 2004/2005 corn crop at 42.7-43.1 million tons from 42.1 million tons
last year. Weekly export sales, released before the opening, are expected to
come in near 1.1-1.4 million tons as compared with 987,800 tons last week.
Support for December corn comes in at 204 and 202 with 207 1/4 and 209 1/2 as
resistance.
Technical Outlook
CORN (DEC) 10/28/2004: Stochastics are at
mid-range but trending higher, which should reinforce a move higher if
resistance levels are taken out. The market’s short-term trend is positive on
the close above the 9-day moving average. It is a slightly negative indicator
that the close was lower than the pivot swing number. The next upside objective
is 209. The next area of resistance is around 207 1/2 and 209, while 1st support
hits today at 205 and below there at 204.
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SOY COMPLEX RECAP
10/27/2004
November Soybeans finished down 9 at 530, 10 off
the high and 1 up from the low. January Soybeans closed down 10 1/4 at 533 3/4.
This was 1 1/2 up from the low and 11 1/4 off the high.
December Soymeal closed down 1.3 at 155.3. This
was 0.8 up from the low and 1.2 off the high.
December Soybean Oil finished down 0.58 at 21.21,
0.84 off the high and 0.03 up from the low.
Gulf basis levels were down sharply as demand has
slowed after the rally this week. Some basis offers were down 5 cents. Rains
have slowed harvest this week in the central cornbelt but the northwestern
cornbelt could get hit with rain and windy weather on Friday which should slow
progress in the areas where harvest is farthest behind. Brazil officials pegged
the 2004/2005 soybean crop at 59.5 to 60.8 million tons from 49.8 million tonnes
last year. The USDA in the October world supply/demand report pegged the crop at
64 million tons which was revised down from 66 million the previous month. The
hefty net short position which was reported in Friday’s COT report combined with
first notice day for November soybeans this week could trigger some
short-covering if resistance levels are violated. Weekly export sales, released
before the opening, are expected to come in near 900,000-1.1 million tons for
soybeans, 150,000-200,000 tons for meal and 5,000-15,000 tons for oil. November
soybean support comes in at 534 and 527 with resistance at 541 1/2 and 552 1/4.
Technical Outlook
BEANS (NOV) 10/28/2004: Studies are showing
positive momentum but are now in overbought territory, so some caution is
warranted. A positive signal for trend short-term was given on a close over the
9-bar moving average. The defensive setup, with the close under the 2nd swing
support, could cause some early weakness. The next upside target is 543 1/4. The
next area of resistance is around 535 1/2 and 543 1/4, while 1st support hits
today at 524 1/2 and below there at 521 1/4.
MEAL (DEC) 10/28/2004: The daily stochastics gave
a bearish indicator with a crossover down. 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 setup is somewhat negative with the close under the 1st swing support.
The next downside objective is now at 153.4. The next area of resistance is
around 156.3 and 157.4, while 1st support hits today at 154.3 and below there at
153.4.
BEANOIL (DEC) 10/28/2004: Daily stochastics have
risen into overbought territory which will tend to support reversal action if it
occurs. A positive signal for trend short-term was given on a close over the
9-bar moving average. The outside day down is a negative signal. There could be
some early pressure today given the market’s negative setup with the close below
the 2nd swing support. The near-term upside objective is at 22.28. The next area
of resistance is around 21.64 and 22.28, while 1st support hits today at 20.78
and below there at 20.55.
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WHEAT MARKET RECAP
10/27/2004
December Wheat finished up 3 3/4 at 319 1/4, 3/4 off the high
and 4 3/4 up from the low. March Wheat closed up 2 at 330. This was 4 up from
the low and 1/2 off the high.
The market had a positive tone for much of the
morning in spite of weaker soybean values with some light concerns with dry
weather conditions in Western Australia and hopes for further export business to
the US due to the weak dollar and expectations for a Pakistan tender soon. The
market has failed to respond much to the good condition of the “just planted”
winter wheat crop. UK officials indicate a wheat export surplus for the
1004/2005 season at 3.1 million tons from 2.2 million tons last year. Recent
estimates were as high as 4.0 million tons but increased use of wheat for
feeding livestock helped to limit the surplus. Soft red basis was steady with
slow movement from producers and hard wheat basis levels were reported to be
firm. Weekly export sales, released before the opening, are expected to come in
near 300,000-400,000 tons as compared with 318,100 tons last week. December
wheat support comes in at 312 and 309 with resistance at 321 1/4 and 324 1/4.
Technical Outlook
WHEAT (DEC) 10/28/2004: The cross over and close
above the 40-day moving average is an indication the longer-term trend has
turned positive. 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 near-term upside objective is at 323
3/4. The next area of resistance is around 322 and 323 3/4, while 1st support
hits today at 316 1/2 and below there at 312 3/4.
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LIVE CATTLE RECAP
10/27/2004
December Live Cattle closed down 0.62 at 86.62.
This was 0.72 up from the low and 0.32 off the high.
November Feeder Cattle finished up 0.22 at
111.60, 0.15 off the high and 0.60 up from the low.
The move under last weeks lows for December
cattle triggered another round of active selling (sell-stops hit) and drove
futures to the lowest level since early September. Traders are disappointed with
the progress this week for resuming exports as the Japan situation looks to be
“months away” before sales begin and South Korea officials indicate they need
more time before allowing US beef into the country. Disappointing cash trade in
Nebraska added to the bearish tone. In addition, traders see a seasonal peak in
beef prices as retailers shift to holiday cuts and poultry for Thanksgiving.
Boxed-beef prices were up 13 cents to $143.15 at mid-session as compared with
$142.71 last week at this time.
Technical Outlook
CATTLE (DEC) 10/28/2004: Momentum studies are
declining, but have fallen to oversold levels. 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 next downside target is
85.500. The next area of resistance is around 87.150 and 87.570, while 1st
support hits today at 86.120 and below there at 85.500.
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LEAN HOGS RECAP
10/27/2004
December Lean Hogs closed down 0.37 at 65.85.
This was 0.60 up from the low and 0.15 off the high.
February Pork Bellies finished down 0.42 at
94.05, 0.50 off the high and 0.30 up from the low.
The hog market followed cattle lower early in the
session and then picked up technical momentum to the downside on the move under
last week’s lows. The lower trending cash market along with weak pork cut-out
values combined with fears that combined meat production is burdensome helped to
trigger active long liquidation selling. The slide in packer margins this past
week has lowered packer demand and hurt live hog prices with cash down again
today. In addition, packers have lowered plans for Saturday slaughter. Weekly
average weights for Iowa/Minnesota for the week ending October 23rd was reported
at 265.1 pounds, down .4 pounds from the previous week and down .5 pounds from
last year. The CME 2-Day Lean Index for the period ending October 25th was
reported at 70.58, up 31 cents from the previous session and down from 72.06 on
October 14th.
Technical Outlook
HOGS (DEC) 10/28/2004: The upside crossover (9
above 18) of the moving averages suggests a developing short-term uptrend.
Momentum studies are trending higher from mid-range, which should support a move
higher if resistance levels are penetrated. The market’s short-term trend is
negative as the close remains below the 9-day moving average. The market tilt is
slightly negative with the close under the pivot. The next upside target is
66.470. The next area of resistance is around 66.200 and 66.470, while 1st
support hits today at 65.500 and below there at 65.000.
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COCOA MARKET RECAP
10/27/2004
December Cocoa finished up 13 at 1470, 8 off the
high and 5 up from the low.
Surprisingly the cocoa market gapped higher and
managed to reach the same high that was seen on October 19th. Apparently the
cocoa market was once again fearful of Ivory Coast political tensions but it
would seem that the marketing flap was only part of the new-found concern. With
French peacekeeping troops in the northern part of the country coming under
gunfire, from unknown sources, many are fearful of a return to extreme violence
throughout the Ivory Coast. Even more surprising is the fact that higher flat
prices of cocoa did not instantly bring on origin selling. Therefore, the near
term bias in cocoa prices might have shifted to the upside, with overhead
resistance not seen until the 1,500 level. Also supporting prices in the action
Wednesday, were reports that cocoa arrivals into consuming countries were
running below anticipated levels.
Technical Outlook
COCOA (DEC) 10/28/2004: The major trend could be
turning up with the close back above the 40-day moving average. 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 gap up on the day session chart gave a
bullish indicator and more follow through could be seen this session. The market
setup is supportive for early gains with the close over the 1st swing
resistance. The near-term upside objective is at 1483. The next area of
resistance is around 1476 and 1483, while 1st support hits today at 1464 and
below there at 1458.
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COFFEE MARKET RECAP
10/27/2004
December Coffee closed up 2.10 at 77.90. This was
1.60 up from the low and 1.00 off the high.
The coffee surged sharply higher led by some
commercial buying in London and a lack of interest in the sell side. The bears
were frustrated with the lack of a reaction to continued good weather in Brazil
and when March coffee opened at the highest level since October 8th,
short-covering and new buying drove the market sharply higher. Northern
hemisphere roasters are into the strongest demand period of the year and Brazil
and Colombia cash markets have been relatively tight. Buyers seem a little less
comfortable in assuming that there will be plenty of coffee available “down the
road” and roasters were even buying deferred contracts. The recent decline in
exchange warehouse stocks is seen as a positive factor.
Technical Outlook
COFFEE (DEC) 10/28/2004: The market now above the
40-day moving average suggests the longer-term trend has turned up. Stochastics
are at mid-range but trending higher, which should reinforce a move higher if
resistance levels are taken out. The market’s short-term trend is positive on
the close above the 9-day moving average. If yesterday’s gap higher on the day
session chart holds, additional buying could develop this session. Since the
close was above the 2nd swing resistance number, the market’s posture is bullish
and could see more upside follow-through early in the session. The near-term
upside target is at 80.35. The next area of resistance is around 79.20 and
80.35, while 1st support hits today at 76.60 and below there at 75.15.
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SUGAR MARKET RECAP
10/27/2004
March Sugar closed down 0.09 at 8.76. This was
0.01 up from the low and 0.09 off the high.
Trade house buying prevented an extended washout
in sugar as speculative and local selling ahead of the end of the month helped
to pressure the market. March sugar closed 9 lower on the session with an inside
trading day as the market continues an attempt to consolidate Monday’s losses.
Rains in the forecast for next week could slow the Brazil harvest but this news
failed to support. Traders await increased cash business from India, Russia and
maybe even China for late this year and early next year. India could buy on
breaks but the cash news is quiet in recent days. Long liquidation selling from
the speculator to lighten up on the massive net long position could be the
dominating force for the rest of the week.
Technical Outlook
SUGAR (MAR) 10/28/2004: The market back below the
40-day moving average suggests the longer-term trend could be turning down.
Momentum studies are still bearish but are now at oversold levels and will tend
to support reversal action if it occurs. The market’s close below the 9-day
moving average is an indication the short-term trend remains negative. The swing
indicator gave a moderately negative reading with the close below the 1st
support number. The next downside target is now at 8.68. The next area of
resistance is around 8.81 and 8.88, while 1st support hits today at 8.71 and
below there at 8.68.
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COTTON MARKET RECAP
10/27/2004
December Cotton finished up 0.21 at 46.83, 0.37
off the high and 0.33 up from the low.
The cotton market pushed slightly higher on the
session but failed to move much above this week’s high with the trade waiting to
see if export news has improved from the weak showing of the past few weeks.
This week’s sales, released before the opening, are expected to come in near
130,000-160,000 bales from 191,900 bales last week. If prices are considered too
cheap, traders expect to see this idea reflected in a surge in exports. If not,
traders might assume that prices are too high and that lower prices may be
necessary to attract improved demand.
Technical Outlook
COTTON (DEC) 10/28/2004: Stochastics are at
mid-range but trending higher, which should reinforce a move higher if
resistance levels are taken out. The market’s close above the 9-day moving
average suggests the short-term trend remains positive. With the close higher
than the pivot swing number, the market is in a slightly bullish posture. The
next upside target is 47.54. The next area of resistance is around 47.18 and
47.54, while 1st support hits today at 46.48 and below there at 46.14.