METALS
The metals are trading firmer in early morning dealings, but near the overnight lows. Bulls are happy that the potential for a bear flag developing on the daily bar chart for August gold has now been negated. In August gold, prices would have to push back above solid resistance at $600.00 to give the bulls better technical momentum. Key shorter-term technical support for August gold today is the overnight low of $589.40. Sell stops likely reside just below that level, and then just below support at $585.00. Buy stops likely reside just above major resistance at $600.00 and then just above shorter-term resistance at $610.00.
ENERGIES
Prices are trading higher in early electronic dealings. Bulls are regaining power as prices overnight pushed above technical resistance at the top of the recent trading range. In August crude, look for buy stops to reside just above resistance at the overnight high of $71.20 and then at $71.50. Look for sell stops just below shorter-term support at the overnight low of $70.26. I look for more trading within the recent well-defined range–bound by key near-term support at this week’s low of $68.65 in August crude and solid resistance at $73.00. But a drop below the aforementioned trading range–including multiple closes below it–would then likely mean a trading range in crude oil prices between $65.00 and $70.00.
GRAINS
Prices were narrowly mixed in quiet overnight electronic trading. Recent beneficial rains and more in the near-term forecast for the Corn Belt are fully bearish, but that news has been factored into the market recently. Now, weather models disagree on the extended weather forecasts for the Corn Belt. Some are calling for hotter and drier weather in the extended forecast. Traders will keep a very close eye on the midday weather updates today. Traders will also seek direction today’s weekly export sales data and from the “outside markets”–gold and crude oil today. It don’t look for much more downside pressure in the grains in the near term. My bias is that the risk in the grain markets now is for a bigger upside move rather than a bigger downside move.
