Commodities Market Update

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Sell December bean oil.  Sell 51.01 stop.  Protective stop 52.41.  Potential projection 48.00.

Reasons for the Trade:

1.  On the monthly chart, bean oil triggered a sell last month.
2.  On the weekly chart, in September bean oil broke out of the huge consolidation it had formed since the beginning of the year to the downside.  It has tested that breakout and has started to sell off again.  Based on the size of that consolidation, there should be much more to the sell-off.
3.  The daily chart has two previous sell signals that are still intact.
4.  On the daily chart, a sell would push bean oil back under the 20 day ma.

GRAIN COMMENTS:  

DEC CORN:  In my last Update I pointed out how corn was struggling to get over 650.  It finally succeeded on Friday but holding that support has been tough.  As to whether it will succeed is a toss of the coin.  It does have a gap up at 685 1/4.  But before that there is the 100 and 150 ma to contend with.  And long term corn's negative stance has not changed.  Closed 650 3/4, down 1/4.

DEC MINI WHEAT:  It sure does wear you down.  It has formed a lot of support under it on the daily chart but it does nothing.  It appears it needs to consolidate more???  It is kind of strange that it has resistance at the same level that corn does: 650.  It needs to get over it.  An inside day yesterday triggered a buy today but without follow through.  Move stops from 604 1/2 up to 627 1/4.  Closed 636 1/4, down 6 1/4.
Position:  Long 636 1/4.
Projection:  700

NOV MINI BEANS:  They have two sell signals on the daily chart and formed an inside day today.  Taking out 1217 1/2 tomorrow would trigger a third sell signal.  Yet they have done nothing for several days.  They are as tedious as the wheat.  Keep stops at 1259 1/2.  Closed 1225 1/2, down 1 1/4.
Position:  Short 1221 1/2 (10.20).
Projection:  1150.

DEC MEAL:  Nothing new with this market.  It continues to "hang around" 320.00.  It trades a little above it and then a little below it.  And, unlike beans or bean oil, it doesn't have either a buy or sell signal.  Just watching.  Closed 322.20, up .70.

DEC BEAN OIL:  Stops were reached on Friday with a profit.  Since then it cannot get over the mid 52.00 level.  A trade could be developing.  See Trade Alert for details.  Closed 51.50, down .29.

Position:  Short 52.45 (10.18).  Exit 51.59 (10.21).  Profit $461 (-comm/fees).
Projection:  48.00.

MEAT COMMENTS:

DEC HOGS:  They triggered a sell yesterday and finally closed under the 20 day ma today.  Near term they still suggest 86.00 but need to get under the 87.50 near term support.  Move stops from 90.50 down to 89.82.  Closed 87.85, down .97.

Position:  Short 88.62 (10.24).
Projection:  86.00.

DEC CATTLE:  They formed a huge outside day today and closed under the 20 day ma.  They have a lot of support under them on the daily chart at 120.00.  Just watching.  Closed 121.97, down .90.

SOFTS:

DEC COTTON:  After failing the 100.00 support, it is now trying to get back over it!  Fickle cotton!  Actually, just looking at that daily chart I keep seeing a bottom being formed.  But it just can't seem to get going.  Its rallies currently are being dominated by the 20 day ma.  It just can't seem to get over it and this has been going on for over two weeks.  Today's high met the same fate.  It needs to close over 100.70 to get over that hurtle for now.  Closed 99.68, up 1.74.

JAN ORANGE JUICE:  In my last Update I mentioned that it had the potential to test the old high of 184.20.  That is still in the cards because the test of the 100 and 150 day ma held and it has been rallying since.  Just watching.  Closed 174.95, up .80.

DEC COFFEE:  Talk about volatile.  On Friday it rallied over 13.00 points.  Today it sold off 14.55 points.  It is beginning to trade like the pork bellies used to!  Very volatile.  What is important is that it sold off from the 250.00 resistance.  Long term and near term that is important resistance and the market let us know that.  I suspect it will try for 225.00 again.  Closed 236.55, down 14.55.

DEC COCOA:  An inside day on Friday triggered a buy on Monday.  The rally stopped at the 20 day ma but did get over it today.  It sold off again to close almost on that moving average.  Cocoa may still be trying to form a bottom but it just isn't clear yet.  At least it is back over 26.00 support.  Let's see if it will hold.  Closed 26.36, up 9.

MAR SUGAR:  I lowered stops above the early day high on Friday and was stopped out.  It rallied since with a high today at 27.70.  It also triggered a buy today and managed to get over the 100 day ma.  The sell-off later in the day held at that moving average.  Watching closely to short.  Closed 26.94, down .16.

Position:  Short 26.66 (10.20).  Exit 27.32 (10.21).  Loss $794.12 (+comm/fees).

METALS COMMENTS:

DEC COPPER:  After two days of an aggressive rally it fizzled out today.  It reached 350.00 resistance and formed a key reversal top.  I suspect the more positive manufacturing news out of China was the reason for the rally.  Just watching.  Closed 342.05, down 2.85.

DEC MINI GOLD:  It held at the 150 day ma that I pointed out last time.  It has rallied since and has gotten over both the 20 day and 100 day ma.  If it can follow through in the rally it could reach 1750.00.  That is where it will start to reach heavy resistance.  Closed 1700.40, up 48.10.

DEC MINI SILVER:  Unlike gold, silver is under both the 100 and 150 day ma.  It is finally over the 20 day ma but has a ways to go before reaching those two moving averages.  The intersect at 37.000 and 37.750.  Just watching.  Closed 33.052, up 1.408.

ENERGY, CURRENCIES & BONDS:

DEC MINI CRUDE OIL:  It is my understanding that the hedge funds have been buying crude.  It rallied over the 100 day ma today on the daily chart.  It now has a good base under it with support at 90.00.  On the weekly it has rallied over the down trend formed since the early May high.  On the monthly chart it is still in a down trend since the Jan. 09 low and this rally appears to be testing that trend line.  In short, crude could be at a crossroads.  One thing that is puzzling is that the global economy is slowing down and crude will reflect that sooner or later since it is a strong economic indicator.  Just watching.  Closed 93.17, up 1.90.

DEC MINI JAPANESE YEN:  After consolidating since early August, the yen finally broke out to the upside and reached 132.16 on Friday.  The key now is follow through.  It tested the breakout yesterday and is so far holding.  Just watching.  Closed 131.81, up 23.

DEC SWISS FRANC:  It has formed a head and shoulders bottom and has broken out to the upside.  It also has a buy signal from last week.  Long term it does have the potential for a retracement to 120.00.  Closed 113.99, up .27.

DEC DOLLAR INDEX:  I raised stops on Friday and they were reached.  It reached the 100 and 150 day ma today and held.  It also reached the 76.000 support.  Watching closely.  Closed 76.321, up .059.

Position:  Long 77.640 (10.18).  Exit 77.000 (10.21).  Loss $695 (+comm/fees).
Projection:  79.000.

DEC MINI EUROCURRENCY:  I lowered stops on Friday to above the early day high and they were reached.  It persists in having trouble at the 139.30-40 level.  Watching closely.  Closed 139.20, down .20.

Position:  Short 136.810 (10.18).  Exit 137.910 (10.21).  Loss $742.50 (+comm/fees).
Projection:  134.000.

DEC CANADIAN DOLLAR:  It formed a huge outside day today.  It rallied to the 100.00 resistance and that price level more than spooked it.  It sold off to 97.78.  It is now trying to consolidate around 98.00.  Its rally could be over with.  Just watching.  Closed 98.48, down .89.

DEC AUSTRALIAN DOLLAR:  Good news out of China re manufacturing data yesterday gave the aussie a boost.  They are tied to China heavily via exports so they reflect strongly what China is doing.  That little bit of good news got the aussie over both the 100 and 150 day ma.  But it reached the 104.00 resistance yesterday and today and seemed stalled out.  Just watching.  Closed 103.92, down .23.

DEC 10 YR. NOTES:  They have been consolidating at the 128.040 level.  Today they formed a huge outside day and closed above the 20 day ma.  They could rally to 129.220.  That is where they will run into resistance.  Just watching.  Closed 129.040, up .250.