What’s Up, What’s Down: Higher Gold, Lower Crude
Comments for Tuesday, November 4, 2008
Looking Ahead to Today By Reflecting back at Monday’s price action
ENERGIES:
Higher for natural gas while sharply lower for crude and heating oil along with the rbob. All of the energies are still in major downtrends with the rbob making a new contract low and close. Natural gas has been consolidating, trying to form a bottom. Opec will continue to try to stem the tide by cutting production but that won’t stop lower energy prices if the world’s economies continue to struggle.
GRAINS:
Higher for Minneapolis, Kansas City and Chicago wheat along wit oats, rough rice, soybeans, soymeal and soyoil. The entire wheat complex continues to be in a downtrend but the strongest of the grains today because of spreading. Also, wheat is still forming potential bottoming formations across the board. Corn settled higher but well of its highs still in a major downtrend.
Rice also closed higher still trying to form a bottom. Oats closed higher still looking weak overall. The bean complex closed higher with beans trying to form a bottom along with oil. However, the overall trends are still down.
INDICES:
Higher closes for the Dow futures along with the S&P’s and Nasdaq while slightly lower for the cash Dow. We’re still looking at major downtrends but the action over the last couple of weeks is showing signs of a possible retracement or bottom.
MEATS:
Higher for live cattle and feeder cattle while lower for lean hogs and pork bellies once again. Spread trading between cattle and hogs recently has almost given me buy signals for the meat complex but not quite. Hogs made a contact low and close while bellies made a contract low only.
METALS:
Higher for gold, copper and silver while lower for platinum this time. Copper still needs to hold the 180 level basis the December contract. This market acts like the downtrend will continue with some signs of bottoming action taking place. Gold continues to look weak overall but silver is in a potential bottoming formation. Platinum settled lower continuing to trade in narrow ranges while consolidating. However, this market should continue lower.
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 ralexander@zaner.com.