Chris Bersaw's  Instablog

Will the recent chill continue for equities? So far that doesn't appear to be the case with the S&P500 futures as prices remained over 1355 and reversed direction to challenge 1404.50 with 1410 behind that for longs to deal with next week. The Nasdaq 100 played catch up after holding 2,500 exceeding 2606.55 looking for 2669 stopping under the downtrend from the Sept. high, also at an inflection point although in both cases volume was sharply lower likely making future gains difficult. 10yr Treasuries pulled away from new contract highs again to challenge 133-06 which continues to hold although not impossible to see prices fall back to 132-00 before its all said and done. The Dollar also declined unable to advance beyond 82.210 now sitting on 80.300 support with more under that level to counter additional selling but as long as 80.00 holds its possible prices can recover but generally being bullish on the greenback has been a losing proposition. Gold shined taking out another resistance level, this being 1738.10 putting in play a challenge of the key 1,800 level which has capped prices for more then one year, fourth time could be the charm, we shall see. Silver also gained taking out a cluster of resistance around 33.305 putting 35.000 in play a level that has capped prices since last November but with new buying present the fourth challenge could be the one that matters while Copper continues to play catch up putting prices within reach of 3.5675 as buyers return not waiting for a challenge of 3.400. Crude survived another challenge of 86.16 building a small base around that level to ultimately push higher from especially if prices can close over 89.04 but face more of a challenge with 92.27 whereas Natural gas continues to advance mostly on short-covering leaving prices vulnerable to profit-taking but downside should be limited by 3.863 as prices remain within striking distance of 4.073 with a close over that level being quite bullish putting in play an eventual run to 4.450. The slow grind high in Feb. Hogs continues remaining in buy the pullback mode should it pull back to 85.000 but might be a while as prices look poised to further their advance now within sight of new contract highs and Feb. Cattle decided to do something, rally in this case, exceeding 130.625 now within reach of new highs of 135.00. Corn did approach 700 but that's all it was able to do before reversing higher closing back over 747 putting 770 in play although think its only matter of time before we see lower prices that challenge 665 but not this week. Wheat remains unmotivated resisting a sell off despite looking like it wants too just that after falling under 878 as 820 still remains in play while an inside week for Soybeans points to a reversal as support 1368 continues to hold with prices likely to bounce toward 1506. Oats attempts to rally but is struggling with 382. Coffee grinds to new contract lows at 149.65 before bouncing to close back over 150.00 support could be an encouraging development but as buyers are still largely out of the market with no reason to buy, prices can continue to churn lower even with fewer sellers although the lower prices go the greater the chance of a reversal as the first upside target remains 162.55. Sugar tries to rally but ran into sellers waiting for a test of 19.82 before sending prices back to the lows within reach of 18.48 whereas Cocoa advances peeking over 2,475 putting in play an eventual return to 2,590 with nearby support seen at 2436. Orange Juice zoomed higher closing in on 130.00 something I expected two weeks ago but this time with more buyers so its possible 130.00 could be breached putting 138.30 in play, otherwise buy the pull backs with support at a distant 115.65 for now and Cotton continues to do very little unable to rally beyond 72.24 putting a another return to 70.00 in play again as prices remain largely range bound.

DISCLAIMER:

The risk of loss trading commodity futures contracts can be substantial. You should, therefore, carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. Trading futures without protective stops or options is not recommended. Past performance is not indicative of future results.

A buy program on the open sent stocks to the high after sellers in the S&P500 futures were unable to take prices under 1365.75 so had to rush to cover positions although gains ultimately didn't hold so more buying is needed to get over the technical hurdles starting with 1397 with a similar performance with Nasdaq 100 as lows of 2553.00 were rejected resulting in short covering as bull's near term upside objective remains 2695.63 to mark the start of the oversold bounce. 10yr Treasuries were rejected at the highs again, this time 134-055, one tick under the high 2 sessions ago and starting to look a little toppy here with support seen at 133-13 and the Dollar grinds higher challenging resistance at 81.345 with support seen at 80.830. Gold drifts lower after being rejected from 1740 two sessions ago but buyers support at 1717.20 which makes me think there is more upside especially if prices take out 1743.30 and an outside day in Silver pointing to higher ground if can take out 33.285 as buyers support at 32.090 for the third time with more support under that level to check losses with Copper also joining the party forming an outside day while struggling with resistance of 3.4795 as the recent profit-taking appears to have run its course with trend line support from the June lows seen at 3.3725. Crude slipped again still unable to get over 86.32 increasing the chances of more selling as 80.00 remains easily in sight but Natural gas explodes higher after overtaking resistance at 3.600 and exceeding 3.708 so prices need to stay over those levels to keep 3.986 within reach something that could happen sooner then later so stay tuned. Hogs stampeded higher looking for 82.000 but missed the mark in a stunning rejection off the HOD looking like a pullback to support of 79.100 is in order but Cattle advances over 125.450 forming an outside suggesting higher prices if can get a close over 126.075 first. Indecision day in Corn after last session sell off with chart-based support seen at 700 with 682 within reach as the levels of overhead resistance continue to grow starting with 736, Wheat continues lower as well probing the lower end of its recent range at 850 with a lot of white space on the chart until the next support level seen at 808 and the selling in Soybeans slows as prices sit on chart-based support of 1400 as selling conviction is lacking. Oats continues to hold 358 as resistance of 363 caps gains. Coffee leaves a bitter taste for anyone who is long as prices plunge 4.39% to new contract lows as sellers get motivated and where it reverses no one knows yet so stay tuned while Sugar after taking 19.28 held that level today challenging 19.52 but closed poorly although able to stay over the new support level to perhaps try again. Cocoa continues to remain over key support of 2,353 for the fourth time pushing higher with resistance of 2,408 to contend with before more gains are possible and Orange Juice brightens up blowing through 107.90 and tagging 109.80 with a trade to 115.05 not out of the question especially if prices can stay over 108.00 on any pull backs which I expect to be purchased. Cotton fell back under 71.05 unable to make any significant upside keeping a trade to 67.20 on the horizon.

DISCLAIMER:

The risk of loss trading commodity futures contracts can be substantial. You should, therefore, carefully consider whether such trading is suitable for you in light of your circumstances and financial resources. Trading futures without protective stops or options is not recommended. Past performance is not indicative of future results.

(click to enlarge)

Chart as of Nov 9th.