What’s Up, What’s Down: Higher Dow Futures, Lower for the Nasdaq
Comments for Monday, August 18
Looking Ahead to Today By Reflecting back at Friday’s price action
Higher rough rice but sharply lower for Minneapolis, Kansas City and Chicago wheat along with corn, soybeans, soymeal and bean oil while lower for oats. Today’s action was really no surprise to me as noted by my previous comments. Buying wheat can be tricky and needs to be deduced using technical considerations along with size of your risk capital coupled with good money management principles.
Corn plunged to settle near the daily limit. This is still a bear market but is now forming a potential bottom that must be carefully watched. Sill 500 is the next objective basis the December contract with 600 where the retracement should stop, if it goes that high. Rough rice bucked today’s trend settling higher still in a critical area to hold while it continues to consolidate in choppy action. Oats closed lower but still could be forming a potential bottom while bearish overall. The bean complex settled sharply lower and still looks down especially the bean oil.
Higher for the cash and Dow futures along with the S&P’s while slightly lower for the Nasdaq. All of the indices continue to look higher.
Sharply lower for live cattle and pork bellies while lower for feeder cattle and hogs. The October cattle contract continues to look neutral although 1050 is a critical area to hold while the December contract lowers. The October feeders closed also settled lower still in a very strong support area starting to turn neutral but overall still bullish. Hogs lower settled with the October contract starting to look toppy. The December hogs are still neutral at this time. Bellies spiked higher then sold off sharply form its session’s high to close lower. This is reversal type action but it’s also the bellies that we’re talking about!
Higher for copper but sharply lower for platinum, gold and silver. The possible sharp drop that I mentioned on Thursday obviously happened today. Copper continue to look lower while in a bear triangle. All of the metals continue to look lower overall with new recent lows and closes in the silver, gold and platinum.
LUMBER: This market settled but no changes technically. Lumber should continue higher overall but is very susceptible to a correction.
COCOA: Cocoa made a new recent low and close in a support area around 2600 area basis the December contract.
SUGAR: This market closed lower following through from Thursday’s in reversal type action and, more importantly, breaking out of a large bull triangle to the downside.
COTTON: Cotton closed lower breaking out of a bear triangle low, making it the lowest low and close since August ’07. Cotton should continue lower in a bearish market overall.
COFFEE: This market closed lower making its lowest low and close since early May and also ending up below its 13500-14000 trading range in the December contract for the first time since June 9th.
ORANGE JUICE: OJ settled lower but now is in a bull flag with little resistance overhead up to the 11000 area. Still this is a very bearish market overall.
Rick Alexander has been a broker and analyst in the futures business for over thirty years. He is a Vice-President for Sales and Trading at the Zaner Group (www.zaner.com) a Chicago-based futures brokerage firm. If you would like a free booklet explaining the charts mentioned above, email Rick at firstname.lastname@example.org.