market snapshot preopen 10/09
OJ had a downside breakout Friday with the slide open for quite a ways. The following chart shows support levels that could be challenged if the selling pressure continues. (Charts from ProphetX).
There has been some noise in the cattle markets. Looking at the intermediate term and shorter term trends reveals that the shorter term may have renewal power.
The grains were stronger (again) in overnight trade with corn up nearly 4c and beans up 1c. Strength in the coming week in either or both of these markets could be indicative of a surge of buying that could drive prices significantly higher. I have a bias that beans have a much higher potential for sliding than corn. Of course wheat is leading the grain complex and strength there has been staggering. If corn were to slide, then a likely target would be 252. If beans slide, the target may well be 537 basis NOV. Judging from the strength of the overnight session, there is at least a chance that the tone set on Monday could be one indicative of further strength. If weakness occurs (DEC corn below 270, beans below 560) then the slide could come to pass.
Sit back and watch.
markets 10/6
Gold has been weaker after breaking through support in the 600, 586, 580, and 576 areas. We could be at a "breather" point before a plunge even (much) lower
or this could be a market finding it's intermediate-term bottom. I'm leaning towards continued weakness (barring some geopolitical event of significance) because the chart is getting weaker by the day.
Corn is incredibly strong. I'm not convinced that this is a push that will get us to 296, 298, and 300 on the DEC chart. There is potential for corn to fall flat on its face - and fast. Weakness could develop as soon as Friday and continue into the report next Thursday. If strength persists, and the market can make a strong Friday close then the chart action from July and June may soon be challenged.
Beans have also been rediculously strong. This is a market that is begging me to go short, but I really struggle with stepping in front of a frieght train (especially one that can move 50c per day). I think the real potential exists for this market to be gasping for its last breath of bull air. Seasonal and fundamental factors are nagging at the bulls. I believe they'll soon have to cave. If this
doesn't happen, then there is something more underlying this market. Right now it seems like price action is producing a noisy chart.
The cattle complex hasn't been terribly exciting lately. The charts for live and feeders look like they want to move higher, but I think the meltdown in crude and metals and the reinvigoration of the grains (probably linked by a coefficient much higher than most estimate) are intimately related.
