WEEKLY FUTURES REPORT

02.16.11

Filed 6:35 pm

Last Last Week

Mar Crude 85.20 86.92

Mar Heat 277.96 276.90

Mar Gas (Blended) 254.50 253.05

Gasoline and heating oil were higher in trading in New York on

Wednesday as domestic fuel demand rose. Also, the Israeli Foreign

Minister said that two Iranian gunboats were planning to pass through

the Suez Canal today en route to Syria. Israel is viewing this as a

provocation. Back in the United States, domestic demand rose 3.8% to a

seven week high. Brent crude oil which has been trading at a premium

to West Texas intermediate oil, hit a 28 month high as tensions in the

Middle East spread to several countries. Insurance buyers were talking

about the headlines and the potential for distribution disruptions.

Gasoline and heating oil are highly calibrated to Brent oil as refineries

taking delivery through New York Harbor price their oil against Brent.

Some geopolitical watchers are worried that Iran will try and exploit the

transition in Egypt to their own ends. The Israelis point out that Iranian

gunboats have not passed through the Suez Canal for many years.

According to the Department of Energy, total fuel demand was higher

last week but gasoline demand was lower. Distillate stocks were lower

by 3.1 million barrels to 161 million barrels, a seven week low. All in all,

most market observers believe the supply demand picture looks bearish

still. Inventories continue to generally build and we are at the threshold

to the end of the heating oil season. Money flow in crude oil remains

negative.

Support Resistance

Mar Crude 84.25 87.00

Mar Heat 268.00 279.00

Mar Gas 242.00 256.50

***********************

METALS

Last Last Week

April Gold 1376.0 1364.30

March Silver 30.665 30.215

Apr Platinum 1833.00 1861.80

Money flow in gold remains positive. Gold was trading at a near fourweek

high on Wednesday as political tensions encourage buying while

China moving interest rates higher to stem inflationary pressures

encouraged selling. Consumer prices in China increased nearly 5% in

January which exceeds the government's target for a fourth consecutive

month. There's every indication that China will continue to tighten

interest-rates. Gold traded at its best levels since mid January. Dollar

weakness after the release of the Federal Open Market Committee

meeting minutes at two o'clock on Wednesday was another positive for

the market. Spreading political unrest in the Mideast is another

positive. Again, interest rates are gold's main competition at this

juncture and it was difficult to deduce from the FOMC committee

minutes that the Fed was inclined to raise rates any time soon. Silver is

being technically traded. Profit-taking in the grain complex is a

negative. Weakness in copper because of stockpiling is a negative.

Support Resistance

April Gold 1355.00 1387.00

March Silver 30.26 31.12

Apr Plat 1813.50 1857.00

*********************************

SOFTS

Last Last Week

March Coffee 258.65 253.60

March Sugar 31.75 31.50

Scarcity of good coffee for a demanding public continues to pressure

prices higher. Commodity fund reallocation has recently pressured

sugar as managers sell sugar positions to take up others in other

markets.

Support Resistance

March Coffee 247.00 259.00

March Sugar 30.00 32.99

*****************************************

Last Last Week

March Soybeans 13.66 14.51

March Corn 6.904 6.9736

March Wheat 8.37 8.86

Recent rains have improved the crop in Argentina. Argentina is the

world's third-largest producer. The crop may exceed 50 million metric

tons if the rains do in fact boost yields. Harvesting of Argentinian

soybeans starts next month and concludes in June. The United States is

the biggest producer of soybeans followed by Brazil then Argentina.

Money flow in soybeans is negative. Money flow in corn is negative.

Money flow in wheat is negative. It’s hard to believe that money flow

would be negative as these markets have been in the news continuously

and shortages have been talked about continuously as well. But if you

just track the money, more money has come out of these markets over

the past several sessions then has been invested in these markets. Maybe

the recent run has matured and the news cycle, at least for now, is at an

end. The soybean chart below reflects it best. Corn still looks healthy

while wheat is technically somewhere in between.

Support Resistance

March Soybeans 13.36 14.25

March Corn 6.705 7.095

March Wheat 8.046 8.916

Chuck Kespert from 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.