Crude Oil Futures
Crude oil futures in the April contract settled last Friday in New York at 44.76 a barrel while currently trading at 42.24, ending the week on a sour note down nearly 8%. The Coronavirus has curbed demand dramatically and looks to stay that way for several more weeks.
I'm not involved, but I do believe prices will go down to the $35 level. I see no reason to be a buyer of crude oil as the airlines and many other sectors are cutting back activities, therefore, demand for oil is extremely weak, and if you are short, stay short as there is significant room to run.
Oil prices are trading far below their 20 and 100-day moving average as this trend is strong to the downside as prices hit a 14-month low. The volatility remains high as that situation will not change as sheer panic has entered this market as nobody wants to travel at this time.
Oil prices are trading far below their 20 and 100-day moving average. This trend is strong to the downside as heating oil and gasoline continue to plummet weekly as you will start to see that reflected in your local gas stations as a bottoming out pattern has not been formed.
TREND: LOWER
CHART STRUCTURE: POOR
VOLATILITY: HIGH
Natural Gas Futures
Natural gas futures in the April contract settled last Friday in New York at 1.68 while currently trading at 1.72 in a relatively quiet non-volatile manor this week as prices remain on the defensive.
Most commodity sectors this week sold off due to the Coronavirus coupled with the fact of above-average temperatures in the midwestern part of the United States, which continues to put pressure on this commodity. I am not involved. However, if you are short, I would place the stop-loss at 1.89 as an exit strategy. However, the chart structure will not improve another 4 trading sessions, so you will have to accept the monetary risk.
If you take a look at the monthly chart, prices could head down to the 1.55 level in the coming weeks ahead. Spring is right around the corner, as that means warmer temperatures as the commodity markets remain weak due to the Coronavirus as it doesn't look like that's going to end anytime soon.
I see no reason to be a buyer as prices are still trading far below its 20 and 100-day moving average as the trend is to the downside as the whole energy sector looks to move lower.
TREND: LOWER
CHART STRUCTURE: SOLID
VOLATILITY: AVERAGE
Copper Futures
Copper futures in the May contract is currently trading lower by 140 points at 2.5580 a pound still stuck in a 5-week tight consolidation looking to break out to the upside, in my opinion.
Fundamentally speaking, there are bullish and bearish factors towards prices as extremely low-interest rates could spark the housing market; therefore, increasing copper demand. However, copper prices also follow the U.S stock market as a possible recession could be at hand as that would be a negative influence, so keep a close eye on this market as this will be a technically driven trade, in my opinion.
Copper prices are still trading under their 20 and 100 day moving average as prices continue to flip flop daily as the longer the consolidation exists, the stronger the breakout in my opinion as the volatility remains high at the present time.
If you take a look at the daily chart, prices may have created a double bottom around the 2.50 level, but we will have to wait and see if that situation comes to fruition. However, I do believe if the U.S equity market starts to stabilize, higher copper prices would be ahead.
TREND: LOWER - MIXED
CHART STRUCTURE: EXCELLENT
VOLATILITY: HIGH
Live Cattle Futures
Cattle futures in the April contract settled last Friday in Chicago at 107.57 while currently trading at 106.00 down over 150 points hitting another contract low as the Coronavirus is crushing demand causing prices to plummet weekly.
I have been recommending a bearish position from around the 124.50 level. If you took that trade, the stop-loss now stands at 116.00, and in Monday's trade will be lowered to 115.60, and in Tuesday's trade will be drop dramatically down to the 113.82 level as the chart structure is improving daily. The volatility remains extremely high, and I don't think that the situation is going to end anytime soon as the U.S stock market is down over 800 points once again as sheer panic has hit all markets at the current time.
If you have been following my previous blogs, you understand that I think prices will hit the 100 level in the coming days ahead as I see no reason to be bullish cattle or the livestock sector so stay short as there is more room to run.
TREND: LOWER
CHART STRUCTURE: IMPROVING
VOLATILITY: HIGH
Rice Futures
Rice futures in the May contract settled last Friday in Chicago at 13.60 while currently trading at 12.95 down about $0.65 for the trading week as prices have now hit a 3 month low.
I have been recommending a bearish position from around the 13.15 level, and if you took that trade, the stop loss stands at 13.78 as the breakout occurred below 13.46 yesterday, so stay short.
Rice prices are now trading below their 20 and 100-day moving average for the 1st time in months as this has been one of the strongest uptrends in 2020, but I believe that has now changed as the Coronavirus is spooking all commodity sectors including rice. The next level of support stands at 12.60, as the volatility certainly has increased over the last couple of weeks. However, the chart structure will not improve for another 5 trading sessions, so you will have to accept the monetary risk at this time.
TREND: LOWER
CHART STRUCTURE: SOLID
VOLATILITY: HIGH
Oat Futures
Oat futures in the May contract settled last Friday in Chicago 2.72 a bushel while currently trading at 2.67 down about $0.05 for the trading week continuing its bearish momentum as prices are right near a 10 month low.
I have been recommending a bearish position from the 2.97 level, and if you took that trade, the stop loss now stands at 2.94 as an exit strategy. However, the church structure will improve daily starting next week; therefore, the monetary risk will be reduced significantly. Oat prices are trading far below their 20 and 100-day moving average as the trend is to the downside as I also have a bearish wheat and rice recommendation as the whole grain sector looks bearish, in my opinion.
There is massive panic across all commodity and stock sectors because the Coronavirus might be spreading more rapidly than first thought. Nobody wants to own anything at the current time, so stay short as I think prices can trade as low as 2.40 in the coming days ahead as we await next week's crop report.
TREND: LOWER - MIXED
CHART STRUCTURE: EXCELLENT
VOLATILITY: HIGH
Sugar Futures
Sugar futures in the May contract settled last Friday in New York at 14.14 a pound while currently trading at 13.14 down about 100 points for the trading week as most commodity sectors continue to sell off due to the panic that the Coronavirus is spreading.
I am not involved as the chart structure is terrible as sugar prices are falling because the Brazilian Real has hit an all-time low against the U.S dollar coupled with the fact that crude oil prices have been crushed lately as sugar is used as biodiesel as well. Sugar prices are trading below their 20 and 100-day moving average, telling you that the trend is to the downside as prices have now hit a 3 month low as I see no reason to be a buyer at this time.
Currently, I do not believe that the risk/reward is in your favor, so be patient & wait for the chart structure to improve, which could take a couple of more weeks as the commodity markets are becoming very cheap. If some type of clarity comes about on the Coronavirus, there could be some terrific buying opportunities, in my opinion.
TREND: LOWER
CHART STRUCTURE: POOR
VOLATILITY: HIGH
Wheat Futures
Wheat futures in the May contract settled last Friday in Chicago at 5.25 a bushel while currently trading at 5.13 down another 12 cents for the trading week as the Coronavirus continues to weaken demand putting pressure on prices as we are right near a 4 month low.
I have been recommending a bearish position initially in the March contract from the 5.44 level, and if you took that trade, the stop loss now stands at 5.40. In Tuesdays, the trade will be lowered to 5.34 as the chart structure has finally started to improve, therefore lowering the monetary risk.
Ideal weather conditions in the Great Plains part of the United States is a fundamental bearish factor towards prices as the mentality is to be risk-off in the short term, so stay short as a bottom has not been formed at this point. The next major level of support stands around the 5.00 level, and if that is broken, 4.80 could be in the cards as prices still look expensive, in my opinion.
TREND: LOWER
CHART STRUCTURE: SOLID
VOLATILITY: LOW
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