Daily Commodities Commentary 3.3.09
Posted in Futures, Options, commodities, commodities commentary, commodity, corn, crude, gold, trading on March 3rd, 2009 by Fast Brokers News – Comments OffGold Daily Commentary for 3.3.09
Gold continued its decline on Monday despite crashing U.S. equities. Gold dropped below all of our supports and tripped beneath our 1st tier uptrend line. Therefore, if Gold does not rise back above the uptrend line very soon, we could see a heightened sell-off in the near-term. Although the fundamentals are turning negative for the time being, the medium-term uptrend is not lost. There are multiple layers of uptrend the precious metal must fall below before we can call the uptrend dead. While investors may be taking profits after impressive gains, if U.S. equities should continue their demise, we have no reason the negative correlation between the two won’t lock in. Fundamentally, we find resistances of $930.76, $937.81/oz, $945.57/oz and $953.15/oz. To the downside, we see supports of $919.22/oz, $911.60/oz, $903.29/oz., and $894.29/oz. The $900/oz area should serve as a reliable psychological cushion in the near-term. Gold is currently trading at $925.05/oz.
Corn Daily Commentary for 3.3.09
Corn futures recovered a bit yesterday despite the steep selloff in the S&P futures. However, the corn futures are still below our near-term downtrend line and all three uptrend lines. Therefore, we maintain our negative stance on corn. If corn should fall beneath February lows, then we anticipate a large selloff with a possible retest of December lows. Corn futures are following the path of U.S. equities. With Prelim GDP coming in well below expectations, investors are anticipating the demand side of the equation to diminish further. As the U.S. economy grinds to a halt, food consumption should decline. Additionally, lower demand for meat in effect reduces the demand for corn used in livestock feed. Furthermore, with U.S. citizens driving less and crude prices at a bargain, the demand for ethanol based fuel is waning. Hence, if the S&P futures should continue their selloff as we anticipate, corn futures should flex their positive correlation and follow suit. Fundamentally, see resistance at $3.4525/bshl, with 2nd tier and top-end resistances hanging at $3.51/bshl and $3.56/bshl, respectively. To the downside, we find support $3.415/bshl with additional supports resting at $3.365/bshl, $3.3325/bshl, and $3.2825/bshl. The $3.50/bshl area becomes a psychological barrier again with a psychological cushion at $3/bshl. Corn futures are currently trading at $3.4525/bshl.
Crude Daily Commentary for 3.3.09
Crude futures crashed on Monday, following U.S. equities into the dumps. Valuations in the stock market have investors worried about the U.S. and global economy as a whole for obvious reasons. Therefore, investors ignored the OPEC supply constraints and sent crude tumbling. However, Crude futures are recovering above the psychological $40/bbl area on Tuesday, and are now lodged solidly between our 1st and 2nd tier downtrend lines. Our uptrend and 2nd tier downtrend line experienced an inflection point yesterday with a highly negative result. Therefore, the futures could be sending a message that the downtrend is far from over. Fortunately for the bulls, the Crude futures still have February lows as a base, so potential losses should be limited in the near term. We expect a near-term rise in Crude futures today with a possible retest of our 2nd tier downtrend line. Fundamentally, we find supports of $40.08/bbl, $39.42/bbl, $38.87/bbl, and $38.08/bbl. The $40/bbl area remains a reliable psychological cushion for the near-term. To the topside, we see resistances of $40.73/bbl, $41.26/bbl and $41.75/bbl, and $42.22/bbl. Meanwhile, the $45/bbl area will serve as a psychological barrier. Crude futures are currently trading at $40.61/bbl.
