Today in Commodities: Markets Take a Breather

Crude prices are still trying to decide on where to go from here; for now the 20 day moving average seems to be acting as the pivot point. As we’ve stated, the range remains $81 to $76.50 on the December contract. Natural gas is lower by 19 cents as of this post. Looking at the pattern in recent sessions we are alternating positive and negative days; under that theory, prices should be higher tomorrow. We are getting a lot of investors' resistance to buying natural gas much like we did back in August and September. We all know how that turned out…stay tuned.

Cocoa was down by $70 today; those short futures trail your stops. It would happen like this as clients' December puts expired worthless yesterday! Sugar broke the trend line closing below 22 cents, we advised clients to stay long but they are down on their position. Coffee prices traded through the trend line losing 4.25% today. We will examine longs from lower levels; support in December is seen at 1.32 and then 1.29.

A major correction would not shock us in the metals, we have voiced this frequently of late and figure if we say it loud and often some of you will listen. At this time we’re not suggesting shorts but to lighten up on longs is sound money management.

The USDA is viewed as a non-event as the recent weather was not factored into the crop size or yield. Corn was higher by just over 2% today as we again trying to attempt an assault on $4 in the December contract. We like being long March and May corn. Live cattle were strong intra day but closed lower. We will continue to accumulate long February calls and futures for clients looking for higher prices to come.

The currencies were quiet as the dollar held the 75.00 line; there was little action. We may look to sell the Euro and Pound for clients but we’ve refrained so far this week.

Risk Disclosure: The risk of loss in trading commodity futures and options can be substantial. Past performance is no guarantee of future trading results.

Comments

[rrdaniel:]

Any long term / fundamental predictions for natural gas ?

Nov 10 06:05 PM

[Options Tra...:]

I would expect the Dow to actually come back down and retest the 10,000 points level again before going any higher.

Nov 11 12:28 AM