7.14.10 Filed Wednesday 7:30 pm
ALL CHARTS THIS WEEK ARE Daily Bars
Last Last Week
September Crude 77.28 74.64
September Heat 203.15 202.93
September Gas (Blended) 206.40 201.82
Crude oil came off in price, modestly, on Wednesday as the
belief that a
wide spread recovery in oil demand may be occurring more slowly
than
previously thought. Tepid retail sales numbers were a negative
for the
market as well as less than robust consumer confidence. Also, a
downbeat assessment of the US economy by the Federal Reserve was
an
oil market negative. Equities started the day with positive tone
thanks to
Intel reporting that business is better than almost ever. But
profit
taking set in and the numbers regarding weekly supply and demand
from the Department of Energy weren’t strong enough to encourage
follow through buying from yesterday’s nearly 3.0% surge. The
American Petroleum Institute stated on Tuesday after trading
hours
that crude stockpiles increased by 1.74 million barrels to 353
million
barrels. On a more positive note, refineries were reported to
have
probably operated at 89.8% of capacity. According to the
Department
of Energy, crude stocks did see a draw of 5 million barrels
against an
expected decline of 1.5 million barrels while Distillates saw an
increase
of 3 million barrels against an expected increase of 1 million
barrels.
The International Energy Agency stated yesterday that global oil
demand will increase but at a slower pace next year. With China
attempting to cool its economy, oil demand may contract to
reflect this
attempt at curbing growth. Market technicians believe that crude
remains trapped in a very wide range defined by $80 above and
$72
dollars below. Money flow in crude oil is positive. Money flow
in
Heating Oil is positive. Money flow in Gasoline is mixed,
indecisive as a
stand alone feature.
Support Resistance
September Crude 73.50 79.80
September Heat 197.00 213.00
September Gas 198.50 213.00
***********************
METALS
Last Last Week
August Gold 1208.7 1203.00
Sept Silver 18.325 18.055
Oct Platinum 1529.8 1528.00
Gold saw modest price pressure on Wednesday after a nice run on
Tuesday which gained most of its energy from the oil market.
Gold was
higher by 1.2% on Tuesday. Also, continued weakness of the
dollar
against the EC was a gold market positive. Gold is higher by
almost
11% for the year. With interest rates continuing near record
lows, gold
remains a good vehicle for wealth preservation. Many find it
difficult to
visualize an appreciable price correction for gold in the coming
months
although to expect the unexpected usually works best with the
gold
market. The record high for gold remains the 1266.00 level. In a
related
market, some technicians see a major downside reversal for
platinum in
the not too distant future. Thin summer time trading conditions
persist
and this can lead to exacerbated moves. Money flow in gold is
positive.
Money flow in silver could reverse with a positive performance
on
Thursday. Money flow in platinum is negative.
Support Resistance
August Gold 1188.00 1231.00
Sept Silver 17.65 18.64
Oct Plat 1498.00 1557.00
*********************************
SOFTS
Last Last Week
July Coffee 162.60 163.95
July Sugar 16.97 17.09
Sugar prices declined on Wednesday after a recent run higher on
the
idea that there would be more than an ample Brazilian crop to
meet
demand. Brazil and India are the world’s two largest producers.
Brazil’s crop yield may climb by 14% next year. This would
result in a
record yield of 41 million metric tons while India may produce
26
million metric tons. Sugar had returned to overbought levels
after a
recent run of 3.4%.
There’s little in the way of fresh news in the coffee physical
market to
report so technicals should continue to dictate trading.
Support Resistance
July Coffee 160.00 167.50
July Sugar 16.00 17.50
*****************************************
Last Last Week
Sept Soybeans 9.572 9.41
Sept Corn 3.842 3.782
Sept Wheat 5.59 5.304
Corn surged higher over the past 5 trading sessions as hotter
than
seasonal weather may damage the current crop in the Midwest
United
States. Some observers believe that as much as 20% of the
current crop
could be damaged over the next six weeks. Temperatures are
expected
to brush up against 100 degrees Fahrenheit next week. Buyers
don’t
have adequate coverage and this is the prime feature to the
higher
values.
Weather is also stressful for the soybean crop. Last week, some
areas
received too much rain while other key areas were hurt by high
temperatures. Commodity funds are on the buy side. The current
weather conditions are as harsh as many can recently remember.
Money flow in corn is negative, however. Money flow in wheat is
positive. Money flow in soybeans is decidedly positive.
Support Resistance
Sept Soybeans 9.50 9.85
Sept Corn 3.68 3.86
Sept Wheat 5.22 5.64
