8.18.10 Filed Wednesday 8:00 pm
ALL CHARTS THIS WEEK ARE Daily Bars
Last Last Week
October Crude 75.52 78.49
October Heat 204.70 210.70
October Gas (Blended) 190.53 195.48
Crude oil fell in price on Wednesday after the release of the US
Department of Energy report which stated that total stockpiles
were at
their highest levels in 20 years. Prices fell for the sixth time
in seven
sessions based primarily on the perception of decreased demand
in the
face of an ever increasing supply. Inventories of all categories
of oil were
higher by 5.3 million barrels to 1.1 3 billion barrels last
week. This
includes both crude oil and its products. Distillate fuels are
at their
highest levels since 1983. Not only are inventories high but
they are
increasing at a time of year when inventories should be
decreasing.
Even though oil fell today, it remains 9% higher from one year
ago at
this time. The distillate fuel stocks were higher by 1.07
million barrels to
174.2 million barrels. Crude stocks fell by 818,000 barrels to
354 million
barrels. Traders had been looking for drop of 1 million barrels.
Gasoline inventories dropped by 39,000 barrels. On a positive
note, fuel
demand rose by 0.4% to 19.6 million barrels a day. Over all,
some
traders thought this was a mixed report which wasn’t decidedly
bullish
or bearish. There is the fear that the US economic recovery is
slowing
and this would result in a reduction in the off-take of oil.
Money flow in
crude oil is negative. Money flow in heating oil is negative.
Money flow
in gasoline is negative as well.
Support Resistance
October Crude 72.50 77.50
October Heat 199.50 209.00
October Gas 183.50 194.00
***********************
METALS
Last Last Week
December Gold 1231.3 1200.40
Dec Silver 18.40 17.96
Oct Platinum 1537.4 1520.60
Gold prices rose on Wednesday as traders looked for a safe haven
from
uncertain market conditions and activity in other investment
sectors.
Summertime trading persists. This is peak vacation time and
trading
can be choppy and prone to change direction arbitrarily. Traders
are
uncertain about the short-term future for the dollar and also
equities so
that they are just moving money into gold to park money until
things
become clearer and a consensus announces itself. Gold on
Wednesday
managed to trade both its technical support and its technical
resistance
levels in the same session. Money flow in gold is positive as it
is in silver.
Expect thin trading conditions to persist and market moves to be
exacerbated because of this.
Support Resistance
December Gold 1220.00 1246.0
Dec Silver 18.20 18.83
Oct Plat 1520.00 1560.00
*********************************
SOFTS
Last Last Week
September Coffee 175.15 170.60
October Sugar 19.60 18.26
A stronger dollar encouraged profit-taking in coffee on
Wednesday.
Trade sources insist that supplies remain tight, however. Until
the South
American October harvest comes in available premium supplies
will
continue to remain tight. Coffee continues to be in a bull
market.
Sugar continues to rally on the idea that supplies will remain
tight due
to weather related concerns. Drought conditions worldwide have
reduced production by as much as 20% than earlier forecast.
Every
time prices decline buyers step into the market. Prices are
higher by
50% since last May. The drought in Russia is considered to be
the worst
in the last 50 years. Sugar remains in a bull market.
Support Resistance
September Coffee 168.00 180.00
October Sugar 18.00 20.50
*****************************************
Last Last Week
November Soybeans 10.306 10.154
December Corn 4.332 4.11
December Wheat 6.886 7.25
Soybeans have continued to rally on the idea that the heat wave
that has
gripped key growing areas in the central United States will
reduce
yields in the current crop. Temperatures in key growing areas in
the
Midwest have averaged 8° higher than normal since the beginning
of
August.
Corn futures were higher by over five cents on Wednesday. Prices
are
up almost 2% this week. Prices have rallied 6 out of the last
seven
weeks. Corn is up 24% since the end of June.
Soybeans rallied by $.15 on Wednesday. The incredible heat wave
has
just managed to make the harvest earlier than ever. Even with
the heat
wave crops should come in at record levels. US farmers will
harvest 13.3
billion bushels of corn up from 13.1 billion bushels last year.
Soybeans
will come in at 3.4 billion bushels greater than last year's
all-time high
of 3.3 billion bushels. Corn will have a deficit however in
terms of
supply and demand figures. The market remains incredibly long in
terms of speculators so expect a shakeout on any change in
weather
models. Money flow in corn is positive. Money flow in wheat is
negative.
The money flow in soybeans is positive.
Support Resistance
Nov Soybeans 10.15 10.54
Dec Corn 4.18 4.37
Dec Wheat 6.65 7.18
