What’s Up, What’s Down: Meats Up, Metals Down
ENERGIES:
EIA Gas Storage released today: One tick higher close for the natural gas while
sharply lower for crude and heating oils along with the rbob. I now have a sell
signal for the heating oil while crude and the rbob are forming possible tops
at this time. Natural gas, however, still looks very bullish.
CURRENCIES:
Higher closes for the Japanese, British Pound, Canadian Dollar, Euro Fx, Swiss
Franc and Aussie Dollar while lower for the dollar index. The euro continued
lower still forming a possible top while the francs made a recent low before
rallying to close higher. However the franc is still bearish overall with little
support down to the 9200 area basis the June contract. The yen also settled
higher still holding the 9600 area basis the June contract and looking bearish
overall. The pound rallied sharply off its lows to close very strong. It continues
in a sideways pattern looking like it’s trying to bottom out.
The Aussie Dollar closed higher acting like it will test its highs and the
best looking, technically, of all the currencies to work higher. This market
still is bullish overall but is foming a possible top. The Canadian dollar now
looks like it also is trying for form a bottom. It has strong resistance over
100 and has been in a sideways market overall since the end of January. The
dollar index closed lower but is still forming a possible bottom.
MEATS:
Higher closes across the board. New recent highs and closes for cattle, feeders
and hogs. June cattle made a new recent high again. Cattle should continue higher
along with feeders that have been forming huge possible bottom. However, 107.50
is a key area to hold basis the August contract or else feeders could retrace
down to the 106.25 area. Hogs rebounded enough from Tuesday’s sharply lower
close to now form a bear pennant. Hogs do have strong support from 72.50 down
to the 70.00 area (basis the June contract). Bellies are in what looks like
a down channel while trying to form a bottom overall.
METALS:
Lower closes across the board this time. Copper is still bullish overall while
continuing in a consolidating mode over the last month. Silver broke out of
bear flag and gold a bear pennant to the downside which is usually indicative
of these markets moving lower. Platinum also settled low
RATES:
Higher closes across the board again even after the expected interest rate
cut of 1/4% by the fed. there are no changes technically at this time. All of
the financials continue to look lower overall but the bonds and eurodollars
are trying to form bottoms at this time.
INDICES: Jobless Claims, Personal Income, Construction Spending,
ISM Manufacturing Index are all released today: A higher close for the Nikkei
while lower for the Nasdaq cash and Dow futures along with the S&P’s and
Nikkei. All of the indices though continue to look higher overall. The Island
Reversal for the Nikkei is still in place.
GRAINS
Export Inspections released today: .Sharply higher for soybeans and bean meal
while higher for bean oil, corn, oats and Minneapolis wheat. New recent lows
for all wheat while also recent low closes for Kansas City and Chicago wheat.
Corn negated Tuesday’s losses to close strong on its way to test all time highs.
Congress is now talking about lessoning the increase of ethanol production
through 2020 probably due to the outrage from many countries that are in a food
crisis at this time. Minneapolis, Kansas City and Chicago wheat are still in
support areas at this time. Also corn plantings are still the furthest behind
in 21 years.
Oats also negated Tuesday’s loss but still didn’t close anywhere near Tuesday’s
high. Oats still need to close over 400 to turn this market higher or close
below 375 basis the July contract to turn it lower. Rough looking like it’s
in a free fall settled sharply lower down 115 cents because of expanded limits.
There still is not much support underneath this market. On the other hand the
bean complex had very strong close but not enough to turn beans, meal and oil
higher overall.
SOFTS
LUMBER: Lumber settled sharply lower unable to penetrate its
resistance. Still lumber could be forming a possible bottom after the action
over the last week. Of course this market is still bearish long term.
ORANGE JUICE: Orange juice had a strong close taking out a
double top and finally giving me a buy signal.
COCOA: Cocoa closed up one tick and is in a small bull pennant
acting like it will test its highs.
COTTON: Cotton had its lowest low and close since early February
basis the July contract again but is still in a decent support area. Cotton
is forming a possible large top and I’m not very close to a sell signal.
COFFEE: Coffee closed higher again. The July contract needs
to close over 14000 again and stay above 13000. There is strong resistance between
13500 and 14000. This market has been basically consolidating since the middle
of March.
SUGAR: Sugar had its lowest close since the 1st week in January
again and also settling below1200 again. Sugar is also in a bear pennant looking
lower with very little support underneath this market.
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. Email
Rick at ralexander@zaner.com.