The NZ Central Bank raised rates overnight. More importantly, BoE Governor King said “it would be wise to take account of the prospect of rising borrowing costs”. This is telling the UK to be ready for rate hikes. This is especially significant when contrasted with overnight comments from Janet Yellen, who said it wasn’t yet time to tighten in the US. King’s comments are really pushing up Sterling. The prospect of higher rates and poor earnings from Boeing and Deutsche Bank are weighing on stocks. Last night’s API report showed a huge build in crude stocks last week; we’ll see if the DOE’s report at 9:30 corroborates. In the big picture, the prospect for higher worldwide interest rates will be a drag on commodity prices, both for the effect on economic growth and the effect higher rates would have on the opportunity cost of commodity investing.
Dec. S&P: A doji yesterday could yield a directional move today. Support is 1082 then important support at 1075. Resistance is 1087.50 then the overnight high at 1091.50.
Dec. NASDAQ: It’s on a momentum sell short signal; support is 1748.25. Resistance is back up at 1758.
Dec. T Bonds: It’s on a momentum sell short signal; support is 119-27.
Dec. Yen: Yesterday’s doji left Monday’s breakout setup unfulfilled-this means we should treat today as another breakout setup. Last Friday’s low at 10953 is the next downside breakout point.
Dec. Euro FX: It’s on an NR4 breakout signal; use yesterday’s low at 1.4880 as a downside breakout point.
Dec. British Pound: Momentum pulled back to zero yesterday (momentum buy signal); then it cleared the trend line at 1.6445. 1.6521 was Fibonacci retracement resistance.
Dec. Canadian Dollar: Apparently if you’re going to be a “high yield, commodity currency” you’d better talk tough on rates. Yesterday BOC Governor Carney commented that the Loonie’s strength is hurting their economy; this was behind yesterday’s pounding. Today it’s testing Fib retracement support at 9461, and there’s a bearish MACD crossover coming. Momentum is down to buy signal levels; this might allow for correction / consolidation.
Dec. Gold: See yesterday’s post here. 1050 is psychological support; last Friday’s low at 1043.70 is next.
Dec. Silver: 17.58 is resistance (it was the midpoint of the past three days’ rally). Last Friday’s low at 17.21 is the next support.
Dec. Copper: Followthrough selling after yesterday’s failure to hold new highs. Support today is around the old high of 290.10; 287.75 is next.
Dec. Cocoa: It’s on an NR4 breakout signal; I would use today’s range as breakout points. 3329 is the old contract high; this is a key level on a closing basis. Much of the world’s cocoa is priced in British Pounds, so a stronger BP should be bullish for cocoa.
March Sugar: It’s on a momentum buy signal after yesterday’s breakout selloff. It held support around 23.30; resistance is 23.98.
Dec. Coffee: Momentum is dropping back to buy signal levels. I’m a bit nervous about trend line support at 139.70. That’s also an old high support area.
Dec. Cotton: It’s on an ID/NR4 breakout setup, and also in a little triangle. Breakout points are 66.66 (the bottom line of the triangle) and 67.92 (Fib resistance).
Dec. Crude Oil: Yesterday it broke trend line support around 79.65. As always, look for a directional move around the 9:30 inventory report. 76.87 is old high support.
Dec Natural Gas: There’s good support in the area of the old highs around 5.830. It’s on a momentum sell short signal today.
Nov. Soybeans: There’s support between 974 and 971; taking that out could lead to more downside today. 984 then 988 are resistance.
Dec. Soymeal: There’s a bearish triangle forming; the bottom is 291.60. The first downside objective is 288.80 (fib retracement); the measuring objective of the triangle is 271.80.
Dec. Wheat: Yesterday’s doji could give a directional move today; support is 511-2.
Dec. Corn: Yesterday’s inability to take out the last high at 388-6 could yield more selloff today. Watch 379 50% retracement of the past four days rally). I’d consider buying a breakout into new highs.
This is a sample of the analysis from my Swing Trader’s Insight advisory service. For information on STI, and to sign up for a free two week trial, visit here.
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