Up, Up And Away
Cocoa
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List, extended its parabolic run to close at a new one-year high in its
fourth straight weekly higher close. Traders were encouraged to buy and
take home longs over the weekend after reports emerged that loadings of cocoa at
Ivory Coast ports did not increase. The strong upside momentum has cleared away
sellers wary of stepping in front of the rally.
Cocoa also rallying rallied out of a Pullback From Highs
pattern. However, look for a potential short covering Monday as the March
contract sets up a
Turtle Soup Reversal sell pattern. Cocoa closed 52 higher at 1056.
Orange
juice
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imperfect bullish engulfing bar and closed on its high for a gain of 1.30 on the
session to 76.40.
March cotton
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tracing higher lows out of its Turtle Soup Plus One set up from Wednesday.
Cotton scored its second consecutive inside day to close .65 higher at 61.25.
Debt futures steepened
slightly in quiet trade, meaning that the short end rose more than the long end
(notes and bills rose more than bonds). As the price of these debt instruments
rises, their interest rate drops. The greater drop in yield in the closer-term
contracts worked to solidify the view that the Fed will cut short-term interest
rates by 50-basis points next week. The February federal funds futures
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Three down signals from the
Futures
Trend Matrix gave the early clue that stock index futures could decline
could tumble. Nasdaq 100 futures
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handles from limit-down curb levels. The futures later rallied more than 110 off
lows before settling 32.00 higher at 2645.50. S&P futures
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1363.30.
Dow futures
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The dollar’s recent
strength appears to be have a different expectation to the bond market on how
much the Fed is likely to cut. Dollars perform better when interest rates are
relatively higher. Recent dollar strength implies that dollar traders believe
the market priced in too much of a rate cut. March dollar index futures
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slipped just .12 to 111.48. Euro FX futures
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Swiss francs
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British pounds
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New 10-Day Lows yesterday, an early indication that their upside momentum
may have been collectively broken and that a downside momentum swing may be in
place. ECH1 gained .00250, SFH1 added .0013 and BPH1 slipped .0006 to
1.4594.
Unleaded gasoline
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is on posting on the
Momentum-5
List and is setup in a cup and handle pattern. Gas is also on the 6/100 Low Volatility
List, so watch this one to make a larger-than-normal move as the volatility
reverts to its mean. Other supporting technical data for the upside
argument include a Pullback From Highs
setup in March crude oil
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February gold
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lower at 262.9. However, gold’s pattern sets it up in a Turtle Soup Plus One Buy
for Monday.
Going the other way and poised to act as a potential
sympathetic booster to gold, silver
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consolidating gains inside of its flag. This contract has going for it (on the
long side) a
Pullback From Highs
setup, a Momentum-5
List reading and a cup-and-handle pattern. March added 1.5 to 482.5.
Grain contracts, which were filing out the Implosion-5 List
and wheat gapped lower to score a second consecutive New 10-Day Low. Traders are looking at the ideal growing conditions in
Brazil, the world’s second largest producer of soybeans and how a large South
American crop will likely (continue to) weigh on prices. Soymeal
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continues to lead the way down here, finishing 1.4 lower at 1.4.