Weekly Futures Report
07.15.09
Filed 6:48 pm Wednesday
Last Last Week
Aug Crude 61.79
60.15
Aug Heat
158.50 154.25
Aug XRB (Blended Gas)
171.20 164.36
Crude oil rallied sharply on Wednesday as the US equity market
staged almost a 3% rally. The Department of Energy report showed
that there was a greater than expected drop in crude supplies as
refiners increased operating rates. For the latest reporting week
crude stocks fell 2.81 million barrels to 344.5 million barrels. The
trade was looking for a drop of 2.1 million barrels. Refineries
operated at almost 88% of capacity, the highest level since last
August. Also supporting oil was the dollar. Dollar trading has
corresponded roughly 82% of the time with the price of crude oil. A
weaker dollar makes crude oil more attractive as an investment.
Crude oil rose about 3.4%. Oil futures are down 60% from year ago
levels. Distillate supplies increased by 553,000 barrels to 159.3
million barrels. The trade was looking for a 2 million barrel gain.
Gasoline inventories were higher by 1.44 million barrels to 146
million barrels, the highest level since last April. Traders were
looking for gasoline supplies to increase by 875,000 barrels. Still,
behind it all, there remains a lot of supply and weak demand. In
political news, Nigeria continued to have trouble with rebels
threatening to call off a recently brokered 60 day cease-fire.
Nigeria produces sweet crude and supplies have been reduced by more
than 20% since 2006.
Support Resistance
Aug Crude
58.50 63.00
Aug Heat
150.00 165.00
Aug Gas
165.00
173.00
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METALS
Last
Last Week
Aug Gold
938.90 909.40
Sept Silver
13.26 12.855
Oct Platinum 1164.70
1102.50
Gold rallied sharply on Wednesday primarily due to a weak
dollar. The one-day advance was the most in two months. Oil rallied
and the dollar fell against other major foreign currencies. The
Consumer Price Index came in higher than expected, introducing a
whiff of inflation into the markets and this was reflected by the
gold rally. The dollar index was down about 1.1%. Gold futures were
up about 1.8%. Crude oil is up almost 4.1% on the day. Inventories
fell for the fourth consecutive week. The street was looking for a
drop of 2.1 million barrels. Money supply in crude oil remains
negative. Demand should continue to be weak. The economy is still in
the process of contraction and working off excess capacity. Gold
should immediately head lower again and retest the 915 level.
Support Resistance
Aug Gold
918..00
949.00
Sept Silver
12.75 13.50
Oct
Plat 1125.00
1175.00
*********************************
SOFTS
Last Last Week
Sept Coffee 118.85
114.75
Oct Sugar
17.77 17.20
Coffee prices rallied for the most in five weeks as a weak
dollar spurred a rally in commodity markets. The dollar traded at
its lowest level in more than a month. Coffee is rallying from an
almost 3% drop since June due to a lack of a frost threat in Brazil.
Coffee is expected to rally and test the 120 level before heading
south again. The current rally is not expected to last as traders do
not expect the prices to extend due to slack demand. Coffee is up
5.3% for the year.
Sugar was up for the fourth straight day. Brazilian output of
sugar has slowed due to rain during the harvest. Sugar is up about
50% this year on perceived increased demand from countries such as
India.
Support
Resistance
Sept Coffee
112.00 120.00
Oct Sugar
17.25 18.05
**********************************************
Last Last Week
Nov Soybeans 9.044
8.92
Sept Corn
3.294
3.252
Sept Wheat
5.346 5.172
Corn futures fell from a one-week high as hedge selling by
grain merchants hit the market. Corn is down 17% for the year.
The dollar traded at its lowest level in almost 5 weeks even
as there was some support early in the sessions for the greenback.
Because of the weak dollar corn and soybeans have become more
competitive against the world market producers. Corn is down 15% for
the year, however while wheat is down by 13% and soybeans are down
6.3%. Grains need a higher energy complex to maintain higher prices.
Support
Resistance
Nov Soybeans
8.90 10.00
Sept Corn
3.150 3.450
Sept Wheat
5.15 5.50
Chuck Kespert
NY/NY
HYPOTHETICAL PERFORMANCE RESULTS HAVE MANY
INHERENT LIMITATIONS, SOME OF WHICH ARE DESCRIBED BELOW. NO
REPRESENTATION IS BEING MADE THAT ANY ACCOUNT WILL OR IS LIKELY TO
ACHIEVE PROFITS OR LOSSES SIMILAR TO THOSE SHOWN. IN FACT, THERE ARE
FREQUENTLY SHARP DIFFERENCES BETWEEN HYPOTHETICAL PERFORMANCE
RESULTS AND THE ACTUAL RESULTS SUBSEQUENTLY ACHIEVED BY ANY
PARTICULAR TRADING PROGRAM.
ONE OF THE LIMITATIONS OF HYPOTHETICAL
PERFORMANCE RESULTS IS THAT THEY ARE GENERALLY PREPARED WITH THE
BENEFIT OF HINDSIGHT. IN ADDITION, HYPOTHETICAL TRADING DOES NOT
INVOLVE FINANCIAL RISK, AND NO HYPOTHETICAL TRADING RECORD CAN
COMPLETELY ACCOUNT FOR THE IMPACT OF FINANCIAL RISK IN ACTUAL
TRADING. FOR EXAMPLE, THE ABILITY TO WITHSTAND LOSSES OR TO ADHERE
TO A PARTICULAR TRADING PROGRAM IN SPITE OF TRADING LOSSES ARE
MATERIAL POINTS WHICH CAN ALSO ADVERSELY AFFECT ACTUAL TRADING
RESULTS. THERE ARE NUMEROUS OTHER FACTORS RELATED TO THE MARKETS IN
GENERAL OR TO THE IMPLEMENTATION OF ANY SPECIFIC TRADING PROGRAM
WHICH CANNOT BE FULLY ACCOUNTED FOR IN THE PREPARATION OF
HYPOTHETICAL PERFORMANCE RESULTS AND ALL OF WHICH CAN ADVERSELY
AFFECT ACTUAL TRADING RESULTS.
