Why Today’s Action In Metals Was Impressive

BOND MARKET RECAP

11/9/2004

December Bonds closed unchanged at 111-31. This
was 0-03 up from the low and 0-09 off the high.

December 10 Yr Treasury Notes finished up 0-005
at 112-090, 0-060 off the high and 0-020 up from the low.

The Treasury market was supported by a
softer than expected Richmond Fed survey but we have to think that the gains
were held back by the rather sharp decline in crude oil prices. Seeing December
crude down $1.25 at times has to brighten the economic outlook and might in the
same fell swoop increase the odds of a U rate hike on Wednesday. The Redbook
weekly chain stock sales were up slightly over the first week of October but the
market didn’t embrace those figures. In the end we think that some Treasury
players were banking some short profits ahead of the coming FOMC meeting.

Technical Outlook

BONDS (DEC) 11/10/2004: Momentum studies trending
lower at mid-range should accelerate a move lower if support levels are taken
out. A negative signal for trend short-term was given on a close under the 9-bar
moving average. The market tilt is slightly negative with the close under the
pivot. The next downside target is now at 111-19. The next area of resistance is
around 112-04 and 112-12, while 1st support hits today at 111-24 and below there
at 111-19.

TNOTES (DEC) 11/10/2004: Momentum studies
trending lower at mid-range should accelerate a move lower if support levels are
taken out. The market’s short-term trend is negative as the close remains below
the 9-day moving average. The close over the pivot swing is a somewhat positive
setup. The next downside objective is now at 112-025. The next area of
resistance is around 112-130 and 112-180, while 1st support hits today at
112-055 and below there at 112-025.

 

STOCK INDICES RECAP

11/9/2004

December S&P finished down 2.3 at 1164.2, 5.8 off
the high and 1.4 up from the low.

December S&P E-Mini closed down 2.25 at 1164.25.
This was 1.5 up from the low and 5.75 off the high.

December Dow closed down 10 at 10387. This was 21
up from the low and 41 off the high.

December Dow E-Mini finished down 8 at 10386, 42
off the high and 20 up from the low.

The stock market banked some profits ahead of the
FOMC meeting but one could tell that some buyers were standing pat with
positions regardless of the threat of higher interest rates. Certainly the Merck
situation was cause for some selling but we have to think that sharply lower
energy prices gave the stock market some underpin. Unfortunately, the energy
complex is already banking on a bearish weekly inventory report Wednesday
morning and because of the looming FOMC meeting, the stock market didn’t get to
benefit from the latest round of lower energy prices. We also think that the
battle of Fallujah was a factor keeping equity prices down early Tuesday as that
battle is fierce and is suspected to be producing casualties.

Technical Outlook

S&P 500 (DEC) 11/10/2004: 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 daily closing price reversal down is a negative
indicator for prices. The market tilt is slightly negative with the close under
the pivot. The near-term upside objective is at 1172.50. With a reading over 70,
the 9-day RSI is approaching overbought levels. The next area of resistance is
around 1167.80 and 1172.50, while 1st support hits today at 1160.60 and below
there at 1158.10.

SP EMINI (DEC) 11/10/2004: Rising stochastics at
overbought levels warrant some caution for bulls. The close above the 9-day
moving average is a positive short-term indicator for trend. The daily closing
price reversal down is a negative indicator for prices. It is a slightly
negative indicator that the close was lower than the pivot swing number. The
near-term upside objective is at 1172.56. The market is becoming somewhat
overbought now that the RSI is over 70. The next area of resistance is around
1167.87 and 1172.56, while 1st support hits today at 1160.63 and below there at
1158.07.

NASDAQ (DEC) 11/10/2004: 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 daily closing price reversal down puts
the market on the defensive. It is a slightly negative indicator that the close
was lower than the pivot swing number. The near-term upside objective is at
1543.00. The 9-day RSI over 70 indicates the market is approaching overbought
levels. The next area of resistance is around 1534.00 and 1543.00, while 1st
support hits today at 1519.00 and below there at 1513.00.

MINIDOW (DEC) 11/10/2004: 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 market could take on a defensive posture
with the daily closing price reversal down. It is a mildly bullish indicator
that the market closed over the pivot swing number. The next upside target is
10454. With a reading over 70, the 9-day RSI is approaching overbought levels.
The next area of resistance is around 10418 and 10454, while 1st support hits
today at 10356 and below there at 10330.

 

CURRENCY MARKET RECAP

11/9/2004

December US Dollar finished up 9 at 8426, 10 off
the high and 20 up from the low.

December Euro finished down 0.15 at 128.97, 0.38
off the high and 0.14 up from the low.

December Euro Dollar closed unchanged at 97.565.
This was 0.005 up from the low and 0.01 off the high.

December Canadian Dollar closed down 0.44 at
83.34. This was 0.04 up from the low and 0.54 off the high.

December British Pound finished up 0.19 at
185.16, 0.43 off the high and 0.42 up from the low.

December Swiss closed down 0.12 at 84.59. This
was 0.11 up from the low and 0.31 off the high.

December Japanese Yen closed down 0.18 at 94.75.
This was 0.16 up from the low and 0.2 off the high.

The Dollar was relatively quiet on Tuesday partly
because the sharp declines in US economic information were offset by sharp
declines in crude oil prices. In other words, if part of the big Dollar declines
of the last two months were forged because of ultra high oil prices then it
might be rational for the Dollar to recover slightly. After all crude oil prices
around the low Tuesday were $8.00 below the highs. We also think that the recent
intervention type dialogue from an ECB official served to discourage additional
Dollar sellers. The British Pound managed to forge the biggest gains against the
Dollar Tuesday and might have managed that gain because of the wrangling between
the Dollar and the Euro, with respect to intervention.

Technical Outlook

YEN (DEC) 11/10/2004: A bearish signal was
triggered on a crossover down in the daily stochastics. Momentum studies
trending lower from overbought levels is a bearish indicator and would tend to
reinforce lower price action. The close above the 9-day moving average is a
positive short-term indicator for trend. The market’s close below the 1st swing
support number suggests a moderately negative setup for today. The next downside
target is 94.40. The 9-day RSI over 70 indicates the market is approaching
overbought levels. The next area of resistance is around 94.92 and 95.11, while
1st support hits today at 94.57 and below there at 94.40.

EURO (DEC) 11/10/2004: The daily stochastics gave
a bearish indicator with a crossover down. 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 above the 9-day moving average suggests the
short-term trend remains positive. It is a slightly negative indicator that the
close was under the swing pivot. The next downside objective is 128.51. The next
area of resistance is around 129.23 and 129.55, while 1st support hits today at
128.71 and below there at 128.51.

 

PRECIOUS METALS RECAP

11/9/2004

December Gold closed up 2.8 at 436.2. This was
2.9 up from the low and 1.3 off the high.

December Silver finished up 0.048 at 7.535, 0.05
off the high and 0.095 up from the low.

January Platinum closed up 0.6 at 850.2. This was
5.2 up from the low and 3.6 off the high.

One has to be very impressed with the precious
metals action Tuesday as the markets made their gains without really having
weakness in the US Dollar. In fact, the rally in gold, silver and platinum
seemed to come off the hope that lower energy prices would allow the world
economy to grow faster and that in turn could boost physical demand or maybe
even inspire some light inflation. In other words, the metals seem to have
diversified their focus away from the Dollar and that is a good thing for the
bulls because the Dollar might find it a little more difficult to fall against
the threat of intervention.

Technical Outlook

SILVER (DEC) 11/10/2004: Daily stochastics have
risen into overbought territory which will tend to support reversal action if it
occurs. The market’s close above the 9-day moving average suggests the
short-term trend remains positive. It is a mildly bullish indicator that the
market closed over the pivot swing number. The near-term upside objective is at
766.9. The next area of resistance is around 760.8 and 766.9, while 1st support
hits today at 746.3 and below there at 737.9.

GOLD (DEC) 11/10/2004: The market rallied to a
new contract high. 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. There could
be more upside follow through since the market closed above the 2nd swing
resistance. The next upside objective is 440.0. The next area of resistance is
around 438.3 and 440.0, while 1st support hits today at 434.1 and below there at
431.6.

 

COPPER MARKET RECAP

11/9/2004

December Copper finished up 1.40 at 137.55, 0.20
off the high and 3.25 up from the low.

The copper market forged an extremely wide range
Tuesday but finally settled back into the bull camp. The market is certainly
seeing improved demand because the macro economic look is improving. In fact,
with energy prices falling smartly it would almost seem like some of the buying
in copper was inflationary expectation buying. We have seen a number of stories
regarding renewed pricing power and the Asian copper premium charge is a prime
example. We also think that the talk of the Chinese government taking delivery
of some Shanghai copper stocks is a real powerful story that helps to facilitate
the return of the old bull camp. This time around the macro look is stronger and
the rest of the metals are helping copper rally instead of hindering it.

 

ENERGY MARKET RECAP

11/9/2004

December Crude Oil closed down 1.72 at 47.37.
This was 0.17 up from the low and 1.23 off the high.

December Heating Oil closed down 2.44 at 134.20.
This was 0.10 up from the low and 3.80 off the high.

December Unleaded Gas finished down 4.14 at
123.39, 3.21 off the high and 0.39 up from the low.

December Natural Gas finished down 0.13 at 7.47,
0.13 off the high and 0.16 up from the low.

December Propane closed down 0.02 at 0.86. This
was equal to the low and 0.00 off the high.

Crude oil prices fell by more than a $1.00 and
unleaded and natural gas prices also fell sharply as many traders are expecting
a 3 million barrel build in US crude stocks. As if giving credence to the
rebuilding pattern, the IEA called for OPEC to allow stocks to continue
rebuilding so that prices can fall even further. In other words, there are
certainly signs that the tightness condition is being tempered. However, it
should be noted that the market has factored in a bearish weekly inventory
reading for Wednesday morning. The IEA request for OPEC does carry weight at the
IEA and the US hold reserves that they could release in the event that OPEC
tries to step in and support prices. Other suggest that the end of the Arafat
era and the attack on Fallujah are bearish developments but that is suspect
reasoning.

Technical Outlook

CRUDE OIL (DEC) 11/10/2004: Daily stochastics are
trending lower but have declined into oversold territory. The market’s close
below the 9-day moving average is an indication the short-term trend remains
negative. 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
46.24. The next area of resistance is around 48.07 and 49.03, while 1st support
hits today at 46.67 and below there at 46.24.

UNLEADED (DEC) 11/10/2004: Momentum studies are
still bearish but are now at oversold levels and will tend to support reversal
action if it occurs. The market’s short-term trend is negative as the close
remains below the 9-day moving average. The defensive setup, with the close
under the 2nd swing support, could cause some early weakness. The next downside
target is 120.50. The next area of resistance is around 125.19 and 127.69, while
1st support hits today at 121.59 and below there at 120.50.

HEATING OIL (DEC) 11/10/2004: Momentum studies
are still bearish but are now at oversold levels and will tend to support
reversal action if it occurs. 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 target is 131.23.
The market is approaching oversold levels on an RSI reading under 30. The next
area of resistance is around 136.15 and 139.02, while 1st support hits today at
132.25 and below there at 131.23.

 

CORN MARKET RECAP

11/9/2004

December Corn finished unchanged at 198, 1
off the high and 1/4 up from the low. March Corn closed unchanged at 210 1/4.
This was 3/4 up from the low and 1/2 off the high.

The market continues to consolidate with focus of
attention on positioning ahead of the USDA report on Friday. According to
Reuters, traders look for corn production near 11.671 billion bushels (range
11.573-11.75) as compared with 11.613 billion last month. In the past 20 years,
the USDA has raised production from the October report to the November report 16
years and lowered the forecast 4 years. The bearish short-term fundamentals are
partially offset by the near record net short position of the speculator which
leaves the market vulnerable to short-covering ahead of the report. The CBOT
lowered initial margin requirements for corn to $388 per contract which is down
from the previous $405 per contract. The weekly crop progress report showed the
harvest 76% complete as compared with trade expectations at 73-77% complete.
Last week, the harvest was 65% complete and the 14-year average for this time of
the year is at 79%. Weather looks favorable to active harvest this week. As of
Sunday, Minnesota was only 59% harvested vs. 92% normal; Iowa was 77% vs. 92%
normal and South Dakota was 47% harvested vs. 84% normal. Support for December
corn comes in at 197 and 192 1/2 with resistance at 201 3/4 and 203 1/4.

Technical Outlook

CORN (DEC) 11/10/2004: Momentum studies are
declining, but have fallen to oversold levels. The market’s short-term trend is
negative as the close remains below the 9-day moving average. It is a slightly
negative indicator that the close was lower than the pivot swing number. The
next downside objective is 197. The next area of resistance is around 198 1/2
and 199 1/4, while 1st support hits today at 197 1/2 and below there at 197.

 

SOY COMPLEX RECAP

11/9/2004

January Soybeans finished up 5 at 510 1/2, 1 1/4
off the high and 6 up from the low. March Soybeans closed up 5 at 516 3/4. This
was 5 3/4 up from the low and 1 3/4 off the high.

December Soymeal closed up 1.2 at 149.9. This was
1.3 up from the low and 0.6 off the high.

December Soybean Oil finished up 0.33 at 20.45,
0.13 off the high and 0.38 up from the low.

The market continues to consolidate recent losses
near the contract lows with focus on Friday’s USDA Crop Production and
Supply/demand report. However, a lack of new selling interest helped support the
bounce and higher close. According to Reuters, traders look for soybean
production near 3.137 billion bushels (range 3.107-3.167) as compared with 3.107
billion last month. In the past 20 years, the USDA has raised production from
the October report to the November report 11 years and lowered the forecast 9
years. The bearish short-term fundamentals are partially offset by the record
net short position of the speculator which leaves the market vulnerable to
short-covering ahead of the report. The CBOT lowered initial margin requirements
for meal to $945 per contract which is down from the previous $1,080 per
contract. Gulf basis levels are firm with talk of a decent line-up of vessels
for loading soybeans. The weekly crop progress report showed the soybean harvest
only 87% complete as compared with trade expectations at 90-91% complete. Last
week, the harvest was 84% complete and the 14-year average for this time of the
year is at 92%. Taiwan is tendering to buy 40,000-60,000 tons of US soybeans.
Weather looks favorable to active harvest in the mid-west. January soybean
support comes in at 505 1/2 and 504 with resistance at 513 1/2 and 516.

Technical Outlook

BEANS (JAN) 11/10/2004: Daily stochastics are
trending lower but have declined into oversold territory. The close below the
9-day moving average is a negative short-term indicator for trend. Market
positioning is positive with the close over the 1st swing resistance. The next
downside objective is now at 502 1/4. The next area of resistance is around 514
and 516 1/2, while 1st support hits today at 507 and below there at 502 1/4.

MEAL (DEC) 11/10/2004: The crossover up in the
daily stochastics is a bullish signal. Daily momentum studies are on the rise
from low levels and should accelerate a move higher on a push through the 1st
swing resistance. A negative signal for trend short-term was given on a close
under the 9-bar moving average. The market has a slightly positive tilt with the
close over the swing pivot. The next upside objective is 151.6. The next area of
resistance is around 150.8 and 151.6, while 1st support hits today at 149.0 and
below there at 147.9.

BEANOIL (DEC) 11/10/2004: A negative indicator
was given with the downside crossover of the 9 & 18 bar moving average. Daily
stochastics declining into oversold territory suggest the selling may be drying
up soon. The market’s short-term trend is negative as the close remains below
the 9-day moving average. The daily closing price reversal up is a positive
indicator that could support higher prices. Market positioning is positive with
the close over the 1st swing resistance. The next downside objective is now at
19.88. The next area of resistance is around 20.70 and 20.89, while 1st support
hits today at 20.20 and below there at 19.88.

 

WHEAT MARKET RECAP

11/9/2004

December Wheat finished down 4 1/4 at 304 1/2, 6 1/4 off the
high and 1/2 up from the low. March Wheat closed down 4 1/2 at 317 1/2. This was
1/2 up from the low and 6 off the high.

The higher opening to a new high since November
1st failed to attract new buying support with talk of an overbought condition
after the 13 1/2 cent bounce off of Thursday’s lows. The market found some
initial support from news that Iraq is tendering for up to 200,000 tons of US
wheat. However, commercial selling led to the lower close and some light fund
selling was noted as well. Taiwan bought 43,000 tons of US wheat overnight and
South Korea announced a tender to buy 21,500 tons of US wheat. The weekly crop
progress report showed the winter wheat crop was 78% in good to excellent
condition, unchanged from the previous week and up from 49% last year at this
time. Poor weather in October has traders revising their Australia production
estimate lower. Overnight private forecasts came in as low as 20.78 million tons
as compared with last months USDA forecast of 23.5 million tons. With the strong
export pace, the USDA may raise exports and lower ending stocks for Friday’s
report. A lower Australia forecast could also trim world ending stocks.
According to Reuters, traders look for wheat ending stocks to come in near 554
million bushels (range 495-592) as compared with 569 million last month.
December wheat support comes at 304 and 302 1/4 with resistance at 311 1/2 and
315.

Technical Outlook

WHEAT (DEC) 11/10/2004: Momentum studies are
declining, but have fallen to oversold levels. The close below the 9-day moving
average is a negative short-term indicator for trend. The downside closing price
reversal on the daily chart is somewhat negative. The swing indicator gave a
moderately negative reading with the close below the 1st support number. The
next downside objective is now at 299 1/4. The next area of resistance is around
307 3/4 and 312 1/2, while 1st support hits today at 301 1/4 and below there at
299 1/4.

 

LIVE CATTLE RECAP

11/9/2004

December Live Cattle closed down 0.55 at 82.47.
This was 0.22 up from the low and 1.17 off the high.

January Feeder Cattle finished down 1.10 at
100.37, 2.27 off the high and 0.12 up from the low.

February cattle closed 80 lower on the session
with a steady flow of fund selling noted in the pit. Continued talk of increased
supply due to Canadian imports for 2005 helped to pressure. Funds have
liquidated a large portion of their net long position in the past several weeks
but the COT report on Friday still showed funds net long over 10,500 contracts
as of November 2nd. February cattle hit key support at 85.60 for the 4th day in
a row. Boxed-beef prices were up $.65 to $130.82 at mid-session as compared with
$137.81 last week at this time. Slaughter came in at 125,000 head as compared
with trade expectations of 117,000-125,000 head. This is the second day in a row
and suggests that packer demand is a bit stronger than expected.

Technical Outlook

CATTLE (DEC) 11/10/2004: Daily stochastics are
trending lower but have declined into oversold territory. The market’s close
below the 9-day moving average is an indication the short-term trend remains
negative. The market could take on a defensive posture with the daily closing
price reversal down. The market’s close below the 1st swing support number
suggests a moderately negative setup for today. The next downside target is
81.320. With a reading under 30, the 9-day RSI is approaching oversold levels.
The next area of resistance is around 83.170 and 84.100, while 1st support hits
today at 81.800 and below there at 81.320.

 

LEAN HOGS RECAP

11/9/2004

December Lean Hogs closed down 0.20 at 71.90.
This was 0.50 up from the low and 0.75 off the high.

February Pork Bellies finished down 1.90 at
100.47, 1.92 off the high and 0.07 up from the low.

February hogs closed 37 lower with a choppy,
inside trading session. The market is still consolidating some of the gains of
the 6-day surge to the highs Thursday. The CME 2-Day Lean Index for the period
ending November 5th was reported at 74.77, up $1.50 from the previous session
and up from 71.21 the previous week. February hogs typically trade at a 500-700
point premium to the cash market at this time of the year but was still at a 285
point discount as of the close. Peoria cash markets were down $2.50 on the day
which contributed to ideas that the cash index will move lower into the middle
of the week. Slaughter came in at 396,000 head as compared with trade
expectations of 388,000-398,000 head.

Technical Outlook

HOGS (DEC) 11/10/2004: A crossover down in the
daily stochastics is a bearish signal. Momentum studies trending lower from
overbought levels is a bearish indicator and would tend to reinforce lower price
action. The market’s close above the 9-day moving average suggests the
short-term trend remains positive. The market tilt is slightly negative with the
close under the pivot. The next downside target is now at 70.720. The next area
of resistance is around 72.520 and 73.200, while 1st support hits today at
71.300 and below there at 70.720.

 

COCOA MARKET RECAP

11/9/2004

December Cocoa finished up 14 at 1806, 24 off the
high and 81 up from the low.

Cocoa prices added some more gains, but early in
the session a hard profit taking slide was seen. In the end, the net gains on
the day were measured and somewhat disappointing considering that the French
supposedly shot and killed 7 Ivory Coast citizens in the crowd. The Press
suggested that the early 63 point decline was profit taking and the influence of
origin selling, but we have to think that profit taking selling is about the
only type of selling one should expect in the face of such ongoing uncertainty
at the Ivory Coast. In other words, only those with physical cocoa to sell, or
those already long should be comfortable selling into this market. Also
supporting prices Tuesday, were signs that Cameroon cocoa growers were holding
back supplies in hopes of getting higher prices off the Ivory Coast tensions.

Technical Outlook

COCOA (DEC) 11/10/2004: Daily stochastics have
risen into overbought territory which will tend to support reversal action if it
occurs. The market’s short-term trend is positive on the close above the 9-day
moving average. The upside daily closing price reversal gives the market a
bullish tilt. The market has a slightly positive tilt with the close over the
swing pivot. The near-term upside target is at 1896. Caution is warranted with
the RSI over 90, as the market may be limited on further gains The next area of
resistance is around 1858 and 1896, while 1st support hits today at 1754 and
below there at 1687.

 

COFFEE MARKET RECAP

11/9/2004

December Coffee closed up 0.15 at 80.00. This was
1.20 up from the low and 0.10 off the high.

Surprisingly coffee prices remained firm despite
the fact that Brazilian green coffee exports managed to rise by 9.7% versus last
year. However, the roasters continue to buy and may be buying off the
expectation for a seasonal increase in demand into the coming winter. However,
we are a little surprised that roasters are willing to pay up for coffee so far
above the last month’s lows. Apparently industry buyers have given the market
some confidence that it really hasn’t had since the August and September rally.

Technical Outlook

COFFEE (DEC) 11/10/2004: Momentum studies are
trending higher but have entered overbought levels. The close above the 9-day
moving average is a positive short-term indicator for trend. The close over the
pivot swing is a somewhat positive setup. The near-term upside target is at
81.00. The next area of resistance is around 80.60 and 81.00, while 1st support
hits today at 79.35 and below there at 78.45.

 

SUGAR MARKET RECAP

11/9/2004

March Sugar closed down 0.09 at 8.51. This was
0.01 up from the low and 0.07 off the high.

While we doubt that sugar prices actually ebb and
flow with energy prices the energy complex is a critical impact on sugar prices.
Therefore, the recent weakness in crude oil probably makes it a little easier to
pressure sugar. It would seem that some funds were interested sellers Tuesday
but it was also clear that trade buyers have recently filled their needs and
will not pay up for sugar in the near term. In fact, some commercial players
were expecting the sugar market to remain weak for the coming two sessions.

Technical Outlook

SUGAR (MAR) 11/10/2004: Daily momentum studies
are on the rise from low levels and should accelerate a move higher on a push
through the 1st swing resistance. A positive signal for trend short-term was
given on a close over the 9-bar moving average. The market setup is somewhat
negative with the close under the 1st swing support. The near-term upside target
is at 8.60. The next area of resistance is around 8.54 and 8.60, while 1st
support hits today at 8.47 and below there at 8.45.

 

COTTON MARKET RECAP

11/9/2004

December Cotton finished up 0.21 at 44.04, 0.66
off the high and 0.24 up from the low.

While the trade continues to see players roll out
of the December contract and into forward contracts there really isn’t a sign
that the down trend pattern is set to end anytime soon. However, some might
expect to see a rather lofty production tally in the Friday report and that
could quickly put cotton prices back down toward the August lows. As we have
mentioned before the outlook for the world economy is improving but cotton will
have to see dramatic increases in demand expectations in order to work through
the coming mountain of supply. We have to think that some of the gains Tuesday
were the result of some shorts banking profits ahead of the coming USDA report.

Technical Outlook

COTTON (DEC) 11/10/2004: Daily stochastics
declining into oversold territory suggest the selling may be drying up soon. The
market’s short-term trend is negative as the close remains below the 9-day
moving average. It is a mildly bullish indicator that the market closed over the
pivot swing number. The next downside objective is now at 43.25. The next area
of resistance is around 44.48 and 45.04, while 1st support hits today at 43.59
and below there at 43.25.