Register for free to join our community of investors and share your ideas. You will also get access to streaming quotes, interactive charts, trades, portfolio, live options flow and more tools.
Agriculture Daily Market Movers (% Price Change)
By: Marty Armstrong | March 21, 2024
• Top Movers
Cocoa (NYCSCE) Futures 3.7 %
Soybean Meal CBT Futures 2.58 %
Canola Futures 2.22 %
Soybeans Futures (CBOT) 2.02 %
Soybean Oil CBT Futures 1.79 %
• Bottom Movers
Orange Juice (NYCE) Futures 2.79 %
Wheat #2 1.47 %
Wheat CBT Futures 1.34 %
Cotton #2 (NYCE) Futures 1.24 %
Cotton 1.11 %
*Close from the last completed Daily
DiscoverGold
Natural Gas Critical Resistance at 20-Day MA Leads to Selloff
By: Bruce Powers | March 20, 2024
• Natural gas faces resistance at 20-Day MA after five days of failed rallies, indicating a possible shift to bearish momentum.
There have been five consecutive days of rallies into resistance around the 20-Day MA and each time price has been rejected to the downside. Today is the fifth but with one important difference relative to the previous three days. Trading has occurred below yesterday’s low, and natural gas is on track to close below that low, which was 1.70. This would indicate greater weakness than what was seen in the past couple of days when the lows were above the prior day’s low and the close was green, above the open.
Sellers Back in Control
Today’s drop indicates that the sellers are back in control. After five days of failing to break through the 20-Day line supply became more aggressive, driving prices lower. That is a change in character from recent days. If it can’t go up, then down or sideways are the two choices. It has been going sideways but today indicates maybe a further decline may be forthcoming. The 8-Day MA crossed below the 20-Day three days ago and it continues to be pointing down.
Depending on what happens next, as today is only one day, if the selling pressure continues the recent 1.64 low may be at risk of being busted. If it does fail to hold as support, the 78.6% Fibonacci retracement level is at 1.63. Weekly support could be seen around 1.64, which was last week’s low.
Increasing Chance of Bearish Continuation
All the signs are there for a possible bearish continuation of the trend. There is a clear downtrend in both the near and long-term price structure and natural gas is below all its moving averages from the 12-Day and up. However, it is sitting at a long-term support zone that includes the lowest traded prices in 28 years. The lowest price of the range is 1.44. It therefore becomes likely that support and a bullish reversal would be seen above that low price.
Recent price action may end up being part of a bottoming process given the significance of the support zone. If that turns out to be the case, the first thing that should happen is a rally above the six-day high of 1.77, followed by a daily close above it. After that the price of natural gas may head higher.
Read Full Story »»»
DiscoverGold
Corn Is The Sleeper. The Corn & Ethanol Report
By: Daniel Flynn | March 20, 2024
We kickoff the day with MBA 30-Year Mortgage Rate, MBA Mortgage Applications, MBA Mortgage Market Index, MBA Mortgage Refinance Index, and MBA Purchase Index at 6:00 A.M., EIA Energy Stocks at 9:30 A.m., 17-Week Bill Auction at 10:30 A.M., Fed Interest Rate Decision, FOMC Quarterly Rate Projections at 1:00 P.M., and Fed Press Conference at 1:30 P.M.
The grains came in weaker, while the soybean complex trades higher as may palm oil futures rocketed to their best close since 2022. Traders will be closely watching the result of GASC tender for May Wheat. It is widely expected that GASG will again cancel the tender as private enterprise and landed prices below Russian fob offers. It appears that the Russian’s want GASC to seek wheat on private vs. public terms which will add additional opaqueness to the Russian market. Expect another low volume choppy trade with short covering featured in the soybean complex, where funds are excessively short soybeans and soybean meal. The flow of food commodities are front and center. Weather in South America and North America are also driving factors in seasonal of average plantings and global shipping costs with insurance
added to cost of doing business in the global export market Today we have the Fed Decision on interest rates and April crude oil expiring. With no major changes in the South American weather all traders are anticipating US Quarterly Grain Stocks and Prospective Plantings before more traders are committed to their position. Keep in mind yesterday’s open interest data showed corn gained 31,000 contracts in the past two days. As the bulls and the bears slug it out it may not only be funds but new fresh money participating in the marketplace and I still remain bullish overall. Soybeans open interest jumped 6,803 contracts and soybean meal 1,063 contracts, while soybean oil fell 1,380 contracts, while Chicago wheat was down 1,163 contracts. Other than new money traders riding the bearish wave, they are wondering the jump in open interest in corn the last two days. The bulls and bears are o positioning ahead of next week’s Quarterly Grain Stocks and planting intentions. This could lead to more volatility this year as traders are NOT keeping their powder dry.
Read Full Story »»»
DiscoverGold
Oil Apprehension. The Energy Report
By: Phil Flynn | March 20, 2024
Oil apprehension is growing after the front month WTI hit the highest price since last October as expectations of supply deficit start to get priced in as more are predicting a potential peak in US oil production. Yet a not-so-bullish American Petroleum Institute (API) report and high anxiety ahead of today’s big FOMC meeting are causing a bit of a pullback in oil and a drop in diesel cracks is raising some demand concerns.
The API, while not bearish, did not live up to the whisper market expectations heading into the report. The API did show a larger-than-expected 1.519-million-barrel draw, but there was some talk of a much larger draw. We were looking for 3.0 million which may still happen in today’s Energy Information Administration (EIA) report at 9:30a central time but it might not matter if the Fed starts to back off rate cuts as the market has priced in. The API also reported a 1.574 million barrel drop in gasoline supply which is a much smaller drop than last week but not scary enough to drive the crack spread. The diesel crack is under pressure as the supply shortage has eased a bit with a slight increase of 512,000 barrel in the weekly API. John Kemp at Reuters pointed out that hedge funds started to cover positions with the combined position in U.S. diesel and European gas oil down to 55 million barrels from 87 million five weeks earlier.
In today’s EIA report there will be a focus on the demand numbers partly due to an adjustment in how the EIA counts production. The amount of production fell to 13.1 million barrels. Last week the EIA said that their crude oil production estimate incorporates a re-benchmarking that decreased estimated volumes by 177,000 barrels per day, which is about 1.3% of the production total. Yet in a world of growing demand and underinvestment in supply, the longer-term outlook for US energy production is going to become more critical.
S&P global reports that ConocoPhillips CEO Ryan Lance at the CERAWeek by S&P Global conference said U.S crude oil production growth in 2024 will likely drop to about 300,000-400,000 b/d in 2024, down from around 1 million b/d in 2023. S&P Global is also reporting that oil product stocks jumped to an 8-month high amid Ramadan. They put the Middle East crude runs to exceed 9 mil b/d for the first time. Total inventories are up 16% since end-2023. Stockpiles of oil products at the UAE’s Port of Fujairah jumped 10% to an eight-month high in the week ended March 18, with regional demand for some products typically slowing during Ramadan observations, according to the Fujairah Oil Industry Zone and historical data. Total inventories increased to 20.049 million barrels as of March 18, the highest since July 10, the FOIZ data published March 20 showed. Stockpiles have increased 16% since the end of 2023.
The Fed worries have slowed momentum, but the underlying outlook is bullish. After the Fed fallout, look for spots to buy.
Natural gas is headed towards a glut but in the big picture could natural gas hit $800. Bloomberg News reports that, “The chief of the largest US producer of natural gas has warned that a lack of pipelines and storage facilities will trigger dramatic price swings in the years ahead, causing them to surge as much 350%. He said, “Gas demand in the US has jumped 50% since 2010, while pipeline and storage capacity have increased just 25% and 10% respectively, EQT Corp. Chief Executive Officer Toby Rice said during an interview at the CERAWeek by S&P Global energy conference in Houston. That leaves the market prone to wild price swings, ranging from today’s level of about $1.75 per million British thermal units to as high as $8, Rice said. “This is the world we live in unless we get serious about getting more infrastructure built,” said Rice, whose company last week agreed to buy Mountain Valley Pipeline developer Equitrans Midstream Corp
Rice is a long-standing and vocal critic of the US regulatory framework and permitting process that he says holds up the construction of new pipeline infrastructure. In November, he warned that a pipeline crunch threatened to trigger an energy crisis. Rice also said in December that falling prices would lead to a slowdown in drilling and that prices were well below the break-even cost of production.
Read Full Story »»»
DiscoverGold
Natural Gas: Consolidation Continues, Watch for Breakout
By: Bruce Powers | March 19, 2024
• Natural gas remains in consolidation near resistance, with prices trading within a narrow range. A breakout above 1.77 could signal a bullish turn.
Natural gas remained in consolidation on Tuesday, as it once again tested resistance around the 20-Day MA (purple). It continues to trade within a five-day range with a high of 1.77 and a low of 1.64. Natural gas briefly advanced above the 20-Day line in late-February after being below it since mid-January. However, the current retracement took it back below the line last week, where it has remained.
Although there has been no continued selloff since then as consolidation has ruled, several successful tests of resistance at the 20-Day MA occurred recently and it reflects bearish price behavior. That would change with a decisive rally above 1.77. But until then, the chance for a bearish continuation remains.
Downtrend on Multiple Time Frames
As can be seen on the chart, natural gas is in a downtrend on multiple time frames. Highlighting the decline starting from the October 27 swing high of 3.64, a series of lower swing lows and highs can be seen on the chart with the most recent lower swing low occurring at the February 20 trend low. There was a brief high swing low generated on January 22, but that attempt to rally quickly faded and led to the most recent lower swing low. Last week’s low was a second attempt at a higher swing low, if it can be maintained.
Bulls Watch for 1.77 Breakout
A decisive breakout above the consolidation high at 1.77 prior to a drop below 1.64 will increase the chances for a higher swing low. This is important as the swing low forms the structure of the trend. One of the first signs that the trend might be attempting to turn up after being down for a while is the occurrence of a higher swing low.
A daily close above 1.77 would confirm that upside breakout and the higher swing low. Natural gas would then be heading towards the bottom zone of the declining blue dashed parallel trend channel. Resistance was seen in that area during the recent rally to the 2.01 peak (B). Next up is the 50-Day MA at 2.10. A simple rising ABCD pattern would complete close to that price level at 2.13.
Read Full Story »»»
DiscoverGold
Grains Report: Wheat, Rice, Corn and Oats, Soybeans, Canola and Palm Oil
By: Jack Scoville | March 19, 2024
• WHEAT
General Comments: Wheat was mostly higher yesterday on reports of higher prices for Russian Wheat. Russia is the worlds largest exporter and sets the world price. It looks like the current prices have accounted for most or all of the bad news to hit Wheat futures. USDA made no changes to its balance sheets last week. Big world supplies and low world prices are still around. Export sales remain weak on competition from Rusia, Ukraine, and the EU as those countries look to export a lot of Wheat in the coming period. It is warm in the US and Canada this week. Black Sea offers are still plentiful.
Overnight News: The southern Great Plains should get mostly dry conditions. Temperatures should be above normal. Northern areas should see mostly dry conditions. Temperatures will average near normal. The Canadian Prairies should see mostly dry conditions. Temperatures should average near normal.
Chart Analysis: Trends in Chicago are mixed. Support is at 527, 524, and 518 May, with resistance at 556, 560, and 572 May. Trends in Kansas City are mixed to down with no objectives. Support is at 561, 552, and 546 May, with resistance at 580, 594, and 605 May. Trends in Minneapolis are mixed to down with no objectives. Support is at 641, 635, and 629 May, and resistance is at 660, 677, and 681 May.
• RICE
General Comments: Rice closed a little lower yesterday, and trends are still sideways in this market. Good demand for export continues. The overseas markets feature less production in Brazil and India, and it appears that the lack of offer from these markets is supporting increased demand for US Rice and prices here in the US. It has turned colder in the US this week and fieldwork will be much reduced.
Overnight News:
Chart Analysis: Trends are mixed to down with no objectives. Support is at 1773, 1759, and 1751 May and resistance is at 1803, 1827, and 1845 May.
• CORN AND OATS
General Comments: Corn was and Oats closed lower, with Corn failing once again to take out the 440 May area on the charts. Demand for Corn has been strong at lower prices and a weaker US Dollar, but the Dollar as higher yesterday and could be turning the short term trends up. Big supplies and reports of limited demand are still around, but futures have been very oversold. Futures are much lower than just a few months ago and a short covering rally is increasingly expected and might be under way. Funds remain very large shorts in the market. Basis levels have started to firm in the US as processors look for supplies amid tight farmer holding patterns. The weather forecasts for Argentina are improving with more showers and rains expected this week. More rain is forecast for central and northern Brazil The planting progress reports to date indicate rapid progress and reports from Brazil indicate that the Winter crop has been mostly planted now.
Overnight News:
Chart Analysis: Trends in Corn are mixed. Support is at 432, 429, and 422 May, and resistance is at 446, 448, and 459 May. Trends in Oats are mixed. Support is at 356, 349, and 344 May, and resistance is at 369, 374, and 376 May.
• SOYBEANS
General Comments: Soybeans and the products closed lower yesterday ideas of weak export demand and on reports of increased selling from Brazil producers as the weather in Brazil became dry in northern areas again and as world demand for Brazil beans remained high. Brazil producers were taking advantage on higher futures in the US and higher basis levels in Brazil. Reports of stronger basis levels and great export demand in Brazil provide some support. Report indicate that China has been a very active buyer of Brazil Soybeans this season. Ideas that South American production is taking demand from the US have pressured futures lower. Funds remain very large shorts in the market. Basis levels in the US are reported to be firming as processors look for supplies and farmers remain tight holders. Rains are in the forecast in Argentina. Such rains would be beneficial for reproducing Corn and Soybeans.
Overnight News:
Chart Analysis: Trends in Soybeans are mixed. Support is at 1175, 1165, and 1153 May, and resistance is at 1206, 1214, and 1233 May. Trends in Soybean Meal are mixed. Support is at 326.00, 329.00, and 307.00 May, and resistance is at 345.00, 348.00, and 352.00 May. Trends in Soybean Oil are mixed to up with objectives of 4880, 4960, and 5070 May. Support is at 4780, 4690, and 4620 May, with resistance at 5000, 5050, and 5100 May.
• CANOLA AND PALM OIL
General Comments: Palm Oil was higher yesterday on production problems in Southeast Asia and as the export pace is expected to really improve. Domestic biofuels demand is also likely to improve. Ideas of weaker production ideas against good demand still support the market overall. The fundamentals of average demand against a weaker supply outlook are still around to keep prices supported. Trends are up on the daily charts. Canola was higher on a stronger US Dollar and Weaker Canadian Dollar. There are still forecasts for better rains in Argentina after a dry spell ends in a week or so and improving weather in Brazil. Current forecasts call for generally improved growing conditions in Brazil this week. The Canola crop is harvested, and it is in bins, so it will take some price movement to get new farm sales.
Overnight News:
Chart Analysis: Trends in Canola are up with objectives of 632.00 and 662.00 May. Support is at 610.00, 602.00, and 594.00 May, with resistance at 638.00, 644.00, and 653.00 May. Trends in Palm Oil are up with no objectives. Support is at 4200, 4120, and 4050 May, with resistance at 4300, 4330, and 4360 May.
Read Full Story »»»
DiscoverGold
Softs Report: Cotton, OJ, Coffee, Sugar, Cocoa
By: Jack Scoville | March 19, 2024
• COTTON
General Comments: Cotton closed a little higher yesterday in moderate volume trading. It is too early to plant in Texas but the heat and dry weather raises concerns about production potential later in the growing season and blackened soils might not permit much planting, anyway. The demand news has been solid in this market for the last several weeks. The US economic data has been positive, but the Chinese economic data has not been real positive and demand concerns are still around.
Overnight News: The Delta will get mostly dry weather and near normal temperatures. The Southeast will see mostly dry conditions and below normal temperatures. Texas will have mostly dry conditions and near to above normal temperatures. The USDA average price is now 88.89 ct/lb. ICE daily certified stocks are now 36,657 bales, from 34,357 bales yesterday.
Chart Trends: Trends in Cotton are mixed. Support is at 92.50, 90.90, and 88.10 May, with resistance of 96.20, 97.70 and 98.40 May.
• FCOJ
General Comments: FCOJ closed sharply lower to limit down yesterday and the daily chart trends are mixed. Futures still appear to have topped out even with no real downtrend showing yet. Prices had been moving lower on the increased production potential for Florida and the US and in Brazil but is now holding as current supplies remain very tight amid only incremental relief for supplies is forecast for the coming new crop season. There are no weather concerns to speak of for Florida or for Brazil right now. The weather has improved in Brazil with some moderation in temperatures and increased rainfall amid reports of short supplies in Florida and Brazil are around but will start to disappear as the weather improves and the new crop gets harvested.
Overnight News: Florida should get scattered showers or dry conditions. Temperatures will average near normal. Brazil should get scattered showers and above normal temperatures. ICE said that 0 notices were posted for delivery against March futures and that total deliveries for the month are now 300 contracts.
Chart Trends: Trends in FCOJ are mixed. Support is at 360.00, 349.00, and 343.00 May, with resistance at 378.00, 389.00, and 391.00 May.
• COFFEE
General Comments: New York closed a little lower and London closed a little higher yesterday on the back of a stronger US Dollar. Robusta offers remain difficult to find and the lack of offer of Robusta is a bullish force behind the London market action. Vietnamese producers are reported to have about a quarter of the crop left to sell or less with half a marketing year in front of them and reports indicate that Brazil producers are reluctant sellers due to currency considerations. Brazil weather continues to improve for Coffee production and conditions are called good. Rains continued to fall in parts of Brazil Coffee areas.
Overnight News: ICE certified stocks are higher today at 0.516 million bags. The ICO daily average price is now 185.04 ct/lb. Brazil will get mostly scattered showers with near normal temperatures. Central America will get mostly dry conditions. Vietnam will see scattered showers. ICE NY said that 56 delivery notices were posted against March contracts and that total deliveries for the month are now 1,253 contracts.
Chart Trends: Trends in New York are mixed. Support is at 180.00, 178.00, and 173.00 May, and resistance is at 186.00, 188.00 and 190.00 May. Trends in London are mixed to up with objectives of 3420, 3520, and 3590 May. Support is at 3310, 3220, and 3100 May, with resistance at 3390, 33420, and 3450 May.
• SUGAR
General Comments: New York and London closed a little higher yesterday on what appeared to be follow through buying from last week. Ideas of weaker demand are around the market and are causing some selling, but producers do not appear to be selling much. The market continues to see stressful conditions in Asian production areas although Indian production estimates are creeping higher and one source there estimates production at about 34 million tons, from 32 million before. There are worries about the Thai and Indian production. Offers from Brazil are still active but other origins. are still not offering in large amounts except for Ukraine. Demand reports from Europe have been strong.
Overnight News: Brazil will get rains in the south and scattered showers in the north. Temperatures should average above normal. India will get mostly dry conditions and below normal temperatures.
Chart Trends: Trends in New York are mixed to up with objectives of 2250, 2360, and 2390 May. Support is at 2180, 21\40, and 2110 May and resistance is at 2260, 2290, and 2320 May. Trends in London are mixed to up with objectives of 654.00, 676.00, and 698.00 May. Support is at 613.00, 604.00, and 597.00 May, with resistance at 638.00, 650.00, and 663.00 May.
• COCOA
Futures were higher again and kept the incredible rally going on production concerns in West Africa as well as demand from nontraditional sources along with traditional buyers. Production in West Africa could be reduced this year due to the extreme weather which included Harmattan conditions. The availability of Cocoa from West Africa remains very restricted and projections for another production deficit against demand for the coming year are increasing. Ideas of tight supplies remain based on more reports of reduced arrivals in Ivory Coast and Ghana continue. Demand continues to be strong, especially from nontraditional buyers of Cocoa.
Overnight News: Isolated showers are forecast for West Africa. Temperatures will be near normal. Malaysia and Indonesia should see scattered showers. Temperatures should average near normal. Brazil will get isolated showers and above normal temperatures. ICE certified stocks are lower today at 4.054 million bags.
Chart Trends: Trends in New York are up with no objectives. Support is at 7710, 6980, and 6660 May, with resistance at 8500, 8620, and 8740 May. Trends in London are up with no objectives. Support is at 6520, 6040, and 5610 May, with resistance at 7000, 7120, and 7240 May.
Read Full Story »»»
DiscoverGold
Sugar $CANE - Update: Continues to flop about after tapping my 'Cup' Targets. Notice the pot'l slanted 'H&S' Plot/?...
By: Sahara | March 19, 2024
• $SUGAR $CANE - Update
Continues to flop about after tapping my 'Cup' Targets. Notice the pot'l slanted 'H&S' Plot/?...
Read Full Story »»»
DiscoverGold
The Corn & Ethanol Report. Forming A Base & Weather Watching
By: Daniel Flynn | March 19, 2024
We kickoff the day with Building Permits Prel, Building Permits MoM Prel, Housing Starts Prel, and Housing Starts MoM Prel at 7:30 A.M., Redbook YoY at 7:55 A.M., 52-Week Bill Auction at 10:30 A.M., 20-Year Bond Auction at 12:00 P.M., Net Long-term TIC Flows at 3:00 P.M., API Energy Stocks at 3:30 P.M., International Monetary Market (IMM) Date and FOMC Meeting.
The National Association of Homebuilders Housing Market Index beat expectations in March, reaching a 8-month high of 51 versus 48 in February and expectations for 48 in March. Falling inventories of existing homes continue to drive home buyers to new home construction. The index is comprised of 3-sub indexes. The index for current sales rose 4 points to 62, the index for home builder expectations within 6-month rose 2 points in the Northeast at 59, the Midwest gained 5 points and the West increased to 43.
South American weather update, The EU & GFS are in agreement in projecting welcomed rainfall worth 1.5-4.0” in Mato Grosso, Goias, and Mato Grosso do Sul March 23-29. This rain will be incredibly welcomed following abnormal heat/dryness in March. Soil moisture will be stabilized/boosted during the first stage of safrinha corn growth there. Coming rainfall in nature as the Climate Prediction Center (MJO Index) shifts slightly eastward, pushing abundant moisture into Northern Brazil. However, this pattern will only be temporary. MJO shifts west again beyond March 30th . Operational models feature the return of warmth/dryness to Brazil in the 12-15 day period. The risk of Brazilian drought remains in place, and ARC reiterates their April weather that determines safrinha corn yields most significantly. This will add interest also watching Brazilian fob sales on CBOT rallies heading into the Quarterly Grain Stocks and Prospective Plantings. These seem to hold the key in the future.
US pattern forecast into early April has added rain/snow to the Dakota’s, IA,MN, and WI – where it is most needed – while the Western & Southern Plains stay arid. 30-day rainfall of 3-9” is needed to clear drought in MO,NE, IA, and pockets in the eastern Midwest, but any/all rain is welcomed across the N Plains and Western Corn Belt. The bulk of coming precipitation in E Plains/ W Midwest occurs March 23-26th . Central US temps will be parabolic into April 1st, but an overall pattern of below normal temps are forecasted. High temps across the principal Corn Belt will exist in the 30’s, 40’s, and low 50’s. Freezing overnight lows periodically impact all but the far southern Midwest and Delta. Early April corn seeding is now unlikely as the trends in soil temps turn down.
Monday’s CBOT corn open interest rose a sharp 20,032 contracts, while Chicago wheat was down 1,591 contracts and soybeans were off 2,262 contracts. Soybean oil open interest rose 5,722 contracts with soybean meal up 3,847 contracts. It’s difficult to explain the big rise in corn and soybean oil open interest other than new money is coming into the space selling corn and soybean oil futures in Monday’s bearish price action. We could be in for another week and a half of two-sided choppy trade.
All CME livestock markets closed higher except April lean hogs. The Smokehouse Creek Fire the largest wildfire in Texas history is 100% contained. We have yet to tabulate the aftermath of destruction that at last count destroyed over 7,000head of cattle in an already thin herd. It will be interesting to digest Friday’s Cattle On Feed data. And Finally moving into Day 1 of the FOMC meetings with decision on rates will be announce at 1:00 P.M. C.S.T. Having heard the hawkish Fed governors, I expect the Fed will stand pat and on cut rates.
Read Full Story »»»
DiscoverGold
Gas Demand Follies. The Energy Report
By: Phil Flynn | March 19, 2024
The first sign of spring is rising gasoline prices. Gasoline prices are surging as RBOB futures hit the highest level since last September on refinery outages and seasonal factors but also because the weak global gasoline demand narrative is filling up with reality. Gasoline demand in the United States is stronger than people had anticipated and if you listen to Exxon Mobil, global gasoline demand has never been better.
ExxonMobil says that global gasoline demand is through the roof and the electronic car movement hasn’t cut into global demand like people assume that it would. Even with all the money that we’ve spent trying to convince Americans to drive electric cars, it seems that that push is falling flat on its face. This of course is probably a good thing because let’s face it, the production of all those electronic vehicles adds to greenhouse gas emissions.
While there is no doubt that people are feeling the impact of higher gasoline prices, so far the demand for gasoline, if you look at the trends, is going to continue to stay strong. The good news for drivers is that the Whiting, IN BP refinery is reportedly back online. But we still have supply shortages around the globe everywhere you look. Refinery outages due to Ukrainian drone attacks in Russia are going to tighten global supply even more and the world will look to the United States to fill that void. I have said before the possibility for price spikes is extremely high when you have oil supplies that are heading into a global deficit and when you have product supplies below average throughout the world, the risk of higher prices and price spikes continues to be high.
Also, if you want to feel better, John Kemp at Reuters points out that gasoline prices were slightly below the average since the turn of the century last month, after adjusting for inflation. Nationwide pump prices (including taxes) averaged $3.33 per gallon in February 2024, which was in the 43rd percentile for all months since 2000 after adjusting for core inflation, explaining why fuel prices have been a political non-issue in recent months.
Today we’re going to get another weekly report from the American Petroleum Institute to find out just how tight supplies are becoming. We expect that we will see a drawdown of 3,000,000 barrels of crude oil this week. We should also see a similar drawdown in gasoline as well as distilled inventories. If that sounds bullish to you then you better hang on to your hat because some of the whisper numbers that we’re hearing from different sources suggest that we could see a crude oil drawdown of over 7 million barrels.
While oil prices may see a little bit of slowing momentum due to the rising dollar and fears about what the Fed may do on interest rates, the reality is that when it comes to supply versus demand I’m afraid we’ve already had the results baked in. Yes, it was historic that Japan raised its interest rates for the first time in 17 years but that was widely expected. If you look at the market action for oil today, it seems to be divorcing itself a little bit from some of the macroeconomic concerns that was driving oil over the last couple of months.
We are in a global supply crunch when it comes to everything petroleum. As we have been running for months, supplies are below average across the globe and now we’re starting to see the demand narrative unwind. This is why we’ve been recommending to be hedged for the long term and continue to recommend that.
Natural gas prices are getting a little bit of hope with a little blast of winter and hope it will see some production cutbacks. Still, negative pricing in some basins may put many producers out of business.
Gold prices have pulled back after its recent record-breaking run and silver. Peter Thomas Chairman at AUSECURE says, “After a week of continuous new highs in the gold market followed by a break triggered by the CPI this week started off very quietly with both the funds and the banks holding off trade as we all wait for the FOMC to be released. Gold spent most of the early trade lower on the day and then tremors out of Russia started after President Vladimir Putin warned NATO that he is fully prepared to use his nuclear weapons. Putin coined a new term not heard before in which he said “sanitary zone” between Ukraine and Russia. Gold rallied up to $6.00 higher on the day but drifted slowly lower over the midday trade. The attitude of the trading day felt neutral towards the close.
Read Full Story »»»
DiscoverGold
Agriculture Daily Market Movers (% Price Change)
By: Marty Armstrong | March 19, 2024
• Top Movers
Wheat #2 2.89 %
Wheat CBT Futures 2.69 %
Cocoa (NYCSCE) Futures 1.92 %
Feeder Cattle (CME) Futures 1.18 %
Tokyo Corn Futures 1.1 %
• Bottom Movers
Orange Juice (NYCE) Futures 2.7 %
Oats (CBOT) Futures 1.97 %
Oats (Minneapolis) 1.86 %
Soybean Oil CBT Futures 1.46 %
Cheese 1.36 %
*Close from the last completed Daily
DiscoverGold
Agriculture Master Report
By: Bill Moore | March 18, 2024
MAY CORN
May Corn is consolidating its 30 cent rally since Feb 26 as it awaits the USDA qtly Stocks/Acreage Intentions Report due out on Thur 3-28-24 at 11am! Mkt tailwinds include lower corn acreage, 35% more exports than 2023, Cheapness – just over $4.00, positive technicals & an abnormally warm & dry winter maybe extending into June-Aug! These have been offset by mkt headwinds including rain in S/A & the Midwest & harvest pressure from Brazil! The $2.00 plus break since last Summer looks to have dialed in the former bearish fundamentals! There is no margin for error in the event of a substandard US Crop!
MAY BEANS
Much like its sister mkt May Corn, May Bean is also consolidating its recent 90 cent rally since the end of Feb. The nearly $3.00 break since last Summer has factored in the double whammy of adequate stocks/slack demand! Intermittent Brazilian rains & still soft exports have kept the lid on recent rallies while the best ever Feb Crush & cold, planting-delaying climes have underpinned the breaks! A price level of $12.00 – not $13.00 or 14.00 is a feather in the bull’s hat & could be the base of substantial rallies – should our very warm & dry winter extend into the planting & growing seasons!
MAY WHT
As if Wht didn’t have enough issues, recent cancellation of Chinese orders of US Wht kept the mkt under wraps but wasn’t able to force new contract lows! Also pressuring the mkt were rains in the Southern plains! However, offsetting these negatives were Russian attacks on the Odessa port & below normal temps in the northern Plains! This netted out to a sideways pattern (530-550) – similar to corn & beans recent trading ranges. Wht is certainly cheap enough to bottom out but will need some exports to appear & not get cancelled! As well, spillover from corn/bean rallies would help!! Finally, wht is also waiting on the momentous USDA Report on stocks & seedings next Thur 3-28-24!
APRIL CAT
Apl Cat has performed like the quintessential trading range it is! Last week, it closed at 190 – the top end of its recent range. Then – the very next day – it closed at 187 – the bottom end of its range! Then , back up today off strong cash & lower slaughter than 2023 however, with very tight supplies & solid demand into the Easter W/E & the coming “grilling season”, the breaks – no matter how extreme – seem to be short-lived! A quick glance at the above chart speaks volumes! When the mkt isn’t going up, it’s hugging the highs – never straying more than $2-3 off them! The seasonals are up & they will be validated soon as we morph into the grilling season – the best demand period of the year!
APL HOGS
Much like its sister mkt Apl Cat, Apl Hogs is also range-bound – albeit a much broader one! The contract broke $5.00 in the past 3 weeks – only to rally back $4.00 since last week! Pork cut-out is the highest it’s been since early October & the seasonals are up going into the grilling season! Hog slaughter & pork production are down over 2023! Hog fundamentals aren’t as strong as cattle but the mkt will benefit from continued strength in its neighbor – in spillover fashion! Finally, the charts are friendly with higher highs & higher lows since the mkt bottomed on Jan 2!
Read Full Story »»»
DiscoverGold
The Corn & Ethanol Report
By: Daniel Flynn | March 18, 2024
We kickoff the week with NAHB Housing Market Index at 9:00 A.M., Export Inspections at 10:00 A.M., 3-Momth & 6-Momth Bill Auction at 10:30 A.M.
The Commitment of Traders Report confirmed a week of fund buying across the principal ag markets. Funds bought 40,900 contracts of corn, 29,000 of bean oil contracts, and 16,900 contracts of soybeans. Funds sold 13,300 of wheat in Chicago but bought 5,300 in Kansas City and 2,400 in Minneapolis. Funds sold 1,400 contracts of soybean meal and remained short in all CBOT markets. Funds sold 1,400 contracts in hogs, 1200 in feeder cattle and bought 3,900 in live cattle. Funds were net long in the 3 CME livestock markets. Across the 10 principal ag markets, funds bought 81,200 contracts, reducing their net short to it’s lowest level since January. While in Friday’s action open interest fell 22,488 in corn, while rising 9,887 contracts in soybeans and 3,204 contracts in wheat. Soybean oil open interest gained 2,014 contracts on the strong rally with soybean meal up 5,394 for the day.
After digesting the fund and new money outside activity, another key to the marketplace, especially the beef market, pressed by the devastating wildfires in Texas & Oklahoma. The economic impact will be felt locally and countrywide with the latest estimate that 7,000 head of cattle was killed. This adds and piles on to another industry whose herds are the lowest since the 1950’s. After attacks on the Cattle Industry this is an Act of God that will further inflate impacting prices and what we can afford to eat at the table. This should make Friday’s Cattle on Feed more interesting, if the actual numbers or a close guesstimate is seen in the data, watch for continued fund activity.
South American weather update has welcome rain impacting Northern Brazil March 23-28 while flooding remains a concern in Southern Brazil. The EU & GFS models remain in agreement with respect to expansion of rainfall into Mato Grosso, Goias, and Minas Gervais in the 8-15 day period, which keeps soil moisture adequate for early safrinha corn growth. Mato Grosso do Sul and Parana will be left short changed and April climate guidance maintains a pattern of widespread dryness and potential for searing heat in Central Brazil, The near-term outlook in C/N Brazil is less threatening this week, but it’s April/early May weather that’s most important. Rio Grande do Sul in far Southern Brazil in the last two weeks has been recorded in a range of 3.4-6.6”. Ag Resources (ARC) also notes their soybean harvest typically begins in early April, and a drier pattern is desired to prevent yield/quality loss. RGDS is projected to account for 15% of total Brazilian soy production over 20 MMT’s of supply.
This morning’s takes are, with CBOT futures opened the week higher, the soy complex sagging in the early Monday morning trade. The Brazil fob paper market is in retreat due to advancing harvest and willingness of Brazilian farmers to sell newly harvested crop on the CBOT rally. This is pressuring CBOT soy futures on hedge related selling, while the wheat market gains on rising Black Sea fob prices offers and the record wheat loadout program that is underlying corn is caught, but doubtful it can score above last weeks $4.45 as needed rain drops across Northern Brazil. Look for back and forth trade in today’s trading session.
Read Full Story »»»
DiscoverGold
Shattered Ceilings. The Energy Report
By: Phil Flynn | March 18, 2024
Brent Crude traded over $86 a barrel posting a new high price for the year as bearish narratives around oil and demand and the fallacies of the energy transition have started to fall apart. The oil markets are starting to price the realities of an undersupplied market after the International Energy Agency had to admit that they were way off in its projection of oil demand and OPEC compliance should be improving with a major announcement by Iraq.
There are reports overnight that Iraq’s oil minister is going to reduce its crude oil exports by 3.3 million barrels a day in the coming months to absorb any increase in registered production that they made in January and February. In other words, they’re cutting back production to make up for the cheating that they’ve done previously.
This should offset the extra oil coming out of Russia because of the damage done to their refineries by the Ukrainian drones. Reports are saying that Russian oil exports from its western ports will be up by 10% to 2.15 million barrels a day. Reuters reports that long-range Ukrainian attack drones launched by the SBU domestic security service have hit 12 Russian oil refineries during the war so far, a Ukrainian intelligence source told Reuters on Sunday. Officials in the southern Russian region of Krasnodar said Ukrainian drones had attacked the Slavyansk oil refinery, 70km (45 miles) north of the regional capital, overnight. The Ukrainian source said the refinery, which processes about 4.5 million metric tons of crude a year and produces fuel mainly for exports, had been attacked in an operation staged by the SBU security service and other Ukrainian forces.
At the same time, the inability of the refineries to produce diesel is causing a surge in diesel prices. This morning we also saw a gasoline surge as well and the reports of weak demand were greatly exaggerated.
That means crack and diesel crack looks to be breaking out on the upside as the market is starting to realize that there’s going to be strong demand for both.
This comes on a week when the market must balance ongoing attacks in the Red Sea and how the rising cost of oil is going to impact the Fed’s plan to cut interest rates. Underneath the oil movement, oil stocks are gaining momentum as the ESG movement is facing the reality that it is contrary to sufficient reason. Decisions made by governments surrounding the green energy transition have made it almost impossible for the US to meet energy demand in the short term and long term.
Reuters reported that in February this year, the IEA predicted demand would rise by 1.22 million barrels per day (bpd) in 2024, while in its February report, OPEC expected 2.25 million bpd. The difference is about 1% of world demand. The difference between between the International Energy Agency and OPEC is a major problem the International Energy Agency is having a moment where they have to start to face up to the reality that the world is going to need a lot more fossil fuels than they have originally reported they have to get back to their mission of energy security from for Europe. The energy agencies and their bad predictions fed into the energy and security loss that we’ve seen in Europe.
Now that the market is starting to realize something that we have been warning about for some time, there is extreme risk to the upside. The globe is heading into a supply deficit and that means that we are still going to be very vulnerable to price spikes. Make sure you are hedged. As we mentioned before we thought there was huge value in energy stocks. ExxonMobil has outperformed the S&P 500 over recent months.
Can there be any hope for a natural gas rally? A surprise increase in rig counts is a head-scratcher. EBW Analytics reported that plunging natural gas prices cleared as low as $1.24/MMBtu last week as extremely mild temperatures nationally—more akin to late April than mid-March—slashed demand for natural gas and pulled the April contract lower to retest contract lows at $1.64/MMBtu. Still, a combination of technical support, weather adding 16 gHDDs over the weekend, supply stabilizing at low levels 3.5 Bcf/d below February highs, and peaking storage surpluses may all help the NYMEX front-month find support near-term and attempt to turn higher.
Read Full Story »»»
DiscoverGold
yes...anything under 2 is a BUY...however the price of purchasing $NATGAS is 20% lower which is MORE of a bargain...AND the lower the price is the higher % fluctuations there are...especially when trading BOIL and KOLD...
Big breakout in copper. Likely has more room
By: Markets & Mayhem | March 17, 2024
• Big breakout in copper. Likely has more room.
Read Full Story »»»
DiscoverGold
Sugar may be putting in a bottom here
By: Markets & Mayhem | March 17, 2024
• Sugar may be putting in a bottom here.
Read Full Story »»»
DiscoverGold
To you, under $2.00 may not mean anything, however, to many including me, this has always been a point to closely observe for a buy opportunity. The chart below is a weekly chart back to 2016 or so and shows only a few meaningful opportunities. All of them are under $2.00. It's just a simple observation on my part and never ever meant as advice and never will be. There is more upside probability than downside and since that probability exists, risk is lowered.
#natgas is better suited with a hashtag...and under $2 is not much of a thing...Natural Gas May 24 almost at all time lows @ 1.80 so being super cheap means it's about to ROCK...we will see next week...$BOIL and $KOLD are measured against May...
What an awesome report!!! TY!!!
$Corn is awakening with $Soybeans and $Soybean Oil (which just finished a very bullish week as the entire oil complex is running with Olive Oil at all time highs)... $Wheat is beat down bad under $5.50 as well as $Natgas under $2.00.
Natural Gas Bearish Momentum Reigns After Brief Bullish Reversal
By: Bruce Powers | March 15, 2024
• Natural gas sees bearish price action after a brief bullish reversal, encountering resistance near the 20-Day MA.
Natural gas got hammered today with bearish price action following yesterday’s one-day bullish reversal. Following an outside day yesterday and strong close that tested resistance at the 20-Day MA, natural gas encountered resistance today near that line following the day’s high of 1.77. That high briefly exceeded yesterday’s high. At the time of this writing, natural gas continues to trade near the lows of the day as it tests support heading towards yesterday’s low of 1.64. If today ends near the lows of the day or below yesterday’s low, the risk of further downside increases.
Next Lower Support Zone Starts at 1.63
Potential support around the 78.6% Fibonacci retracement is close by at 1.63, along with prior support at 1.61. These levels can be looked at as a potential support range from 1.63 to 1.61. Moreover, there is a more significant price level at 1.59 as it is a weekly low. Earlier this week a bearish reversal was triggered on the weekly chart as the price of natural gas dropped below last week’s low of 1.755. A drop below the three-week low at 1.59 would indicate further weakness and increases the chance that the downtrend may continue below the recent trend low of 1.52. Two weekly support levels failing within one week is bearish.
Resistance was seen recently at 2.01, which is the bottom of the blue dashed descending trend channel. It shows prior support levels now acting as resistance since the price levels were busted on the way down. This behavior reflects the remaining weakness from the long-term downtrend.
Negative Reaction to Thursday’s Intraday Advance
Given today’s negative reaction to yesterday’s bullish price action, the indication is that the downtrend still dominates. It seems fair therefore to use this week’s high of 1.84 as an important price level to key off. If natural gas remains below that weekly high downward pressure remains and the downtrend rules. A rally above that high would be needed to improve the chances for a sustainable rally and bottom reversal.
Weekly High for Bullish Signal
If a bullish reversal from this week’s candle does occur natural gas will next be heading up into potential resistance at the bottom of the declining trend channel. Further, the recent swing high of 2.01 marks the next higher possible resistance zone. Nevertheless, a daily close above the lower trend channel line (blue dash) will increase the chance that natural gas can eventually rally above 2.01.
Read Full Story »»»
DiscoverGold
Row Crops & Day Of Reckoning. The Corn & Ethanol Report
By: Daniel Flynn | March 15, 2024
We kickoff the day with Export Prices MoM & YoY, Import Prices MoM & YoY, and NY Empire State Manufacturing Index at 7:30 A.M., Industrial Production MoM & YoY, Manufacturing Production MoM & YoY and capacity Utilization at 8:15 A.M., Michigan Consumer Sentiment Prel, Michigan 5-Year Inflation Expectations Prel, Michigan Consumer Expectations Prel, Michigan Current Conditions Prel, and Michigan Inflation Expectations Prel at 9:00 A.M., NOPA Crush report at 11:00 A.M., and Baker Hughes Oil & Total Rig Count at 12:00 P.M.
The latest Illinois Crop Production Cost report showed that while Central Illinois nitrogen prices are slightly above the late 2023 low, fertilizer values are at the lowest price in 3 years, 28% Nitrogen solution was quoted in a range of $346-440/ton with an weighted average price of $384. This is down $167/ton or 30% cheaper than a year ago and the lowest March offer since 2021. Anhydrous ammonia was quoted from $730-880/ton with an average of $799, down 366/ton or 31& less than last year. On per-unit cost, the spread between 28% and AA narrowed by $0.7/Lb or 27% compared to a year ago at $.20/Lb. The CBOT futures came out mixed with summer row crops slightly lower while world wheat traders’ debate whether China canceled or rolled forward their Australian wheat purchases. There is no confirmation that China canceled or postponed ant French wheat purchases. US and European wheat values are slightly higher with profit taking noted in long soybeans and short wheat spreads. A mixed trading session is expected today with bears using weakness to reduce their net exposure with the USDA Stocks & Seedings report just 9-days away. The heavily short hedge fund positions, South American weather/yields and demand destruction weigh on this heavily positioned bear market (at the moment), with new outside money steadily flowing in the grain complex. Expectations for today’s February Crush report is forecast for a record crush. Which is keeping the pendulum swinging bull or bear, supply & demand. Open interest data showed corn gaining 1,083 contracts, soybeans 7,143 contracts, and Chicago wheat 7,896 contracts. Soybean oil was up 4,308 contracts and soybean meal open interest added 1,056 contracts.
Read Full Story »»»
DiscoverGold
The Energy Report
By: Phil Flynn | March 15, 2024
I’m the friendly stranger in the black sedan. Won’t you hop inside my car? Beware the Ides of March as the International Energy Agencies’ (IEA) prophecies are questionable and may be a betrayal of their energy security mission.
Global petroleum markets must reassess their outlook after the (IEA) soothsayers had to admit that they once again underestimated demand and overestimated supply. That led to many hedge funds with questionable positions that may have to be liquidated. Now the market must get a handle on just how large the supply deficit is going to get and just how tight supply is going to become. The market must now realize that the possibility of an oil price spike could help derail the Fed rate cut plans. Inflation is still too hot but at the same time, consumers are feeling pain as retail sales start to falter. Faulty data from the IEA led to hedge fund selling in the market and now that they know it’s wrong, must start getting out of bad positions.
US producer prices on a year-over-year basis increased by 1.6%, the biggest move since September 2023 as the cost of goods like gasoline and food surged. Yet the Fed may have a problem not cutting rates as retail sales rose 0.6% last month, less than expected after falling a revised 1.1% in January.
There is talk of a breakout in the Commodity Price Index. Hedge funds that have been betting on lower to sideways markets will have to reassess positions as they have to look at the signs of the times. Bloomberg News reported that, “commodities got sucked into a global short volatility trade. They say that, “Traders are betting against volatility in raw materials prices, countering the commodity sector’s notoriously boom-and-bust history. Whether it’s an oil market that is stuck firmly in a range due to OPEC+ cuts and abundant spare capacity, or copper prices torn between surging renewable demand and strains in more traditional consumption areas, there have been plenty of factors keeping the world’s commodity prices stuck in recent months. Gas volatility is back to where it was before a supply crisis in Europe. It makes for another sector in global markets where one of the most dominant trades has been betting against big swings. Macro volatility has been grinding lower as equities push higher and billions of dollars pour into exchange-traded funds wagering on continued calm.“’
Yet now with the International Energy Agency and OPEC talking about supply deficits and the possibility they could be much larger, the hedge funds may have to cover that could lead to an explosive move not unlike what we saw recently in copper and it could mean sharply higher prices at the pump after the price spike. The Fed will have to reassess their rate cutting schedule. They’re in a tough place because to back off a rate cut going into an election year might be viewed as political so beware the ides of March because the soothsayers have got it wrong.
The Energy Information Administration reported that In 2023, the world produced an estimated 101.8 million barrels per day (b/d) of petroleum and other liquids: mostly crude oil but also lease condensate, natural gas liquids, biofuels, and other liquids from hydrocarbon sources. We expect the global petroleum and other liquids supply to increase by about 0.4 million b/d in 2024 and 2.0 million b/d in 2025. This growth will be driven primarily by rising crude oil production from four countries in the Americas—the United States, Guyana, Canada, and Brazil—which would partially offset near-term voluntary production cuts in 2024 that we expect from countries participating in the OPEC+ agreement.
Collectively, OPEC+ countries accounted for 43% (43.7 million b/d) of global liquids production in 2023. The EIA forecast that OPEC+ petroleum liquids production will fall by 1.0 million b/d this year and then increase by 0.9 million b/d in 2025 after most existing production cuts expire. We assume OPEC+ members will maintain some voluntary production cuts through 2025 to offset slow demand growth. The OPEC+ production targets are based on crude oil volumes rather than all petroleum liquids, and we expect the crude oil portion of production in these countries to decline by 1.1 million b/d in 2024 and then increase by 0.9 million b/d in 2025.
The gasoline crack spread looks like it’s on the verge of breaking out to the upside. Diesel crack is a little bit more subdued. It’s probably time to start putting on those hedges. Natural gas did get a bit of a bounce as more talk of production cutbacks are starting to make the rounds. The huge contango in the natural gas market is giving some hope that there could be some relief down the road. The question is whether that relief comes with increased demand or just lower production. As we recommended before, to be short the front end of the curve along the back has really paid off.
Read Full Story »»»
DiscoverGold
Natural Gas Buyers Likely to Drive Prices Higher
By: Bruce Powers | March 14, 2024
• Despite resistance zones, a breakout above the recent swing high could lead to further gains, with a first higher target around 2.13.
Natural gas may have completed a bottom for the retracement today with a new pullback low of 1.65. Although the 78.6% Fibonacci level at 1.63 was not reached today’s price action indicates a possible switch from the sellers being in charge to the buyers taking control of price action. There is an increased likelihood of a rally off today’s low. Yesterday’s high of 7.72 was exceeded as a high of 1.76 was reached today following a drop to new trend lows. That high is at the time of this writing, and it may be higher by today’s close. A daily close above yesterday’s high will be a slightly more bullish indication than a close below it.
Signs of a Bottom and Bullish Reversal
Today is the first day of the retracement where the price of natural gas exceeded a prior day’s high, which is a sign of strength. It sets up a potential rally that has the potential to breakout above the recent 2.01 swing high. This scenario is supported by the behavior of the 8-Day and 20-Day moving averages.
The 8-Day line crossed back above the 20-Day line on March 4 for the first time since late-January, and it stayed above it during this current retracement. If the scenario plays out the first higher target looks to be around 2.13. That is where a rising ABCD pattern utilizing today’s low would hit its first target (see chart).
Resistance on the Way Up
Nonetheless, there are price areas of concern on the way up. First, is the price zone around the recent swing high. It stopped the ascent and led to a retracement. That zone is derived from previous long-term support zones (now resistance) from 1.95 to 1.97. Further, it is in the area represented by the lower blue dashed trend channel line.
The recent swing high hit resistance very close to the line and it could do so again. Notice that the line represented support on December 12 and then resistance in early-February and most recently. In other words, the market has clearly identified this line. Therefore, it could represent resistance once again. In addition, a decisive breakout above the recent swing high would have the added significance of breaking through the trendline.
Read Full Story »»»
DiscoverGold
Commodity price changes over last year...
By: Charlie Bilello | March 13, 2024
• Commodity price changes over last year...
Cotton: +17%
Gold: +13%
Silver: +11%
Sugar: +5%
Coffee: +4%
WTI Crude: +4%
US CPI: +3.2%
Brent Crude: +1%
Gasoline: -1%
Aluminum: -2%
Copper: -3%
Heating Oil: -6%
Zinc: -12%
Soybeans: -20%
Wheat: -20%
Corn: -28%
Natural Gas: -34%
Read Full Story »»»
DiscoverGold
The Corn & Ethanol Report. Texas Oklahoma Wildfires Rage On
By: Daniel Flynn | March 14, 2024
We kickoff the day with PPI MoM & YoY, Core PPI MoM & YoY, Retail Sales MoM & YoY, Export Sales, Initial Jobless Claims, Retail Sales Ex Autos MoM, Continuing Jobless Claims, Jobless Claims 4-Week Average,
And PPI Ex Food, Energy & Trade MoM & YoY at 7:30 A.M., Business Inventories MoM and Retal Inventories Ex Autos MoM at 8:00 A.M., EIA Natural Gas Storage, 4-Week & 8-Week Bill Auction at 9:30 A.M., and 15-Year & 30-Year Mortgage Rate at 10:00 A.M.
The EIA’s weekly energy stocks data report showed draws in crude oil of 1.536 Mil barrels last week marking the largest 1-Week decline in 7 week. Compared to a year ago, stocks were 33 Mil barrels (7%) smaller marking the 10th consecutive week of year-over-year declines. Cushing was down 220,000 barrels after increasing by 701,000 last week. Gasoline stocks dropped by 5.62 MB, which is the largest 1-week decline in over a year, and well above expectations of 1.( MB, Distillate stocks rose by 888,000 barrels, which was far above expectations of 150,000 increase. One of the few markets not experiencing shortages for the moment.
We’ll start out with US weather and move over to Argentine & Brazilian weather. The kicker to the weather pattern is the midday GFS output being ignored, which is adding widespread rainfall of 2-5” in TX, OK, KS, NE, and IA March 26-28. No other model trended wetter. This is too little too late for Oklahoma & Texas that are having wildfire warnings like a thunderstorm warning in spring. March 26 is still 12-days away. The live cattle and feeder cattle market should perk up even further taking into account all the livestock as herds are at lows dating back to the 1950’s More blizzards are pounding the West again, Colorado received their share in a 48 hour period.
The EU & GFS models are at odds over the 10-day precipitation totals in Brazil. The better performing EU model keeps rainfall confined to far S Brazil, leaving the safrinha corn belt hot/dry into March 22nd . There remain hints of improved rain chances beyond March 23rd, but confidence in extended range details is low. Rain has been extracted from Brazilian forecast since early March. Heavy rainfall of 3-4” is forecast in far S Brazil and NE Argentina. Drier weather will be needed here in April to facilitate row crop harvesting. All eyes are on Brazilian rainfall. Dryness in N Brazil in early/mid-March is a big deal given this is a typically wet time of year. There will be limited tolerance for sustained dryness in Mato Grosso, Mato Grosso do Sul, and Parana beyond the next 10-days.
CBOT grain futures are mixed this morning with spot palm oil futures rising to their best levels in a year while soybean futures basis May need a technical close above 1202. The 50-day moving average. CBOT wheat values are lower on the expectations that recent Chines SRW sales cancelations will be itemized in today’s export sales data and could include additional canceled cargoes that fell below 100.000 MT’s daily reporting requirement. The CBOT has a bearish feel with Northern & Central Brazilian weather forecast adding rain for the winter corn crop. Wednesday’s CBOT open interest data showed corn gaining 15,305 contracts, soybeans gaining 8,859 contracts, and Chicago wheat adding 3,101 contracts. Soybean oil open interest was up 8,723 contracts while soybean meal fell 70 contracts. The recent CBOT rally is more than short covering with new money flowing into the space. Hedge fund managers see grain values as “cheap” heading into a new Northern Hemisphere growing season.
Read Full Story »»»
DiscoverGold
Agriculture Daily Market Movers (% Price Change)
By: Marty Armstrong | March 14, 2024
• Top Movers
Orange Juice (NYCE) Futures 2.66 %
Kuala Lumpor Palm Oil Crude Futures 1.6 %
Coconut Oil 1.58 %
Soybean Oil CBT Futures 1.57 %
CRB Index 1.01 %
• Bottom Movers
Wheat #2 2.35 %
Coffee (NYCSCE) Futures 1.75 %
Soybean Meal CBT Futures 0.83 %
Wheat CBT Futures 0.58 %
Lean Hogs (CME) Futures 0.56 %
*Close from the last completed Daily
DiscoverGold
Dereliction Of Duty. The Energy Report
By: Phil Flynn | March 14, 2024
Some might say that The International Energy Agency (IEA) has been derelict in its duty to secure energy security for Europe because they have been taken over by a green energy agenda.
Not it appears they must acknowledge they were wrong about stopping investments in fossil fuel but today, they have to acknowledge what I have been saying for months and that is that hat the world is headed into a crude oil supply deficit supply deficit.
Oil price broke back above $80 a barrel WTI after the IEA that the global oil market will face a supply deficit having to backtrack on their previous forecast of a supply surplus. As I have written many times in the past, the IEA has constantly underestimated demand and overestimated production in some cases to make their green energy models work and to try to make them look somewhat feasible, when it’s not.
The IEA had to change its global oil demand growth forecast by 270,000 barrels a day and now says that the world will see growth of 1.7 million barrels a day which will be a new record high.
The IEA says that “Global oil demand is forecast to rise by a higher-than-expected 1.7 mb/d in 1Q24 on an improved outlook for the United States and increased bunkering. While 2024 growth has been revised up by 110 kb/d from last month’s Report, the pace of expansion is on track to slow from 2.3 mb/d in 2023 to 1.3 mb/d, as demand growth returns to its historical trend while efficiency gains and EVs reduce use.”
Maybe the International Energy Agency hasn’t been paying attention to what’s been going on in the electronic vehicle market. Pinning your hopes that electronic vehicles are going to reduce demand growth significantly doesn’t match up with the reality that we’re hearing in the real electronic vehicle world. EV sales s are horrible and companies are losing massive amounts of money on the electronic vehicle. Not only did Apple abandon its car yesterday, but it was also reported that Porsche is abandoning its electric vehicles.
The IEA National Energy Agency blamed OPEC, and they say that they expect OPEC will continue their cuts through the end of 2024. The IEA blamed OPEC saying they changed the assumptions and shifted our implied balance into a slight deficit rather than a hefty build in last month’s report.
The IEA put world oil production is projected to fall by 870 kb/d in 1Q24 vs 4Q23 due to heavy weather-related shut-ins and new curbs from the OPEC+ bloc. From the second quarter, non-OPEC+ is set to dominate gains after some OPEC+ members announced they would extend extra voluntary cuts to support market stability. Global supply for 2024 is forecast to increase 800 kb/d to 102.9 mb/d, including a downward adjustment to OPEC+ output.
The IEA also had to acknowledge another thing I have been warning about and that is the tight global oil supply despite the historically warm winter that we had in many places even as they try to spin it to look better.
The IEA said that Global onshore oil stocks fell a further 38 mb last month, taking the drawdown since July to 180 mb, according to preliminary data.
Over the same period, oil on water surged. Trade dislocations from the rerouting of Russian barrels and more recently due to unrest in the Middle East, have boosted oil on water by 115 mb. In February alone, oil on water surged by 85 mb as repeated tanker attacks in the Red Sea diverted more cargoes around the Cape of Good Hope. At nearly 1.9 billion barrels as of the end of February, oil on water hit its second-highest level since the height of the COVID-19 pandemic.
The bottom line is that the International Energy Agency tried to sell us a bill of goods and now they have to admit they were wrong, They weren’t wrong by a little bit by a long shot. For years I have warned about the International Energy Agency and the loss of their mission their fixation on the energy transition had them lose their. Direction sadly Matt blow to their credibility it’s going to take some time to repair. When I first started to point this out I seemed to be in the minority but more and more people in the oil industry are starting to take the International Energy Agency predictions with more skepticism than they have before. It’s a shame when we used to look to the International Energy Agency as a non-biased reporting agency and now have to realize that they have an agenda and the agenda sadly is energy security for Europe.
Today’s breakup of $80.00 is significant especially if we can hold it into the close above $80.00 a barrel should induce short covering his hedge funds continue to favor the short side of the market.
.And after yesterday’s Energy Information Administration (EIA) report showed that US petroleum inventories (crude, SPR, refined products) are at the lowest point since end-2022 the market is starting to face up to a new reality. The reality is that the expected crash in global oil demand is not going to happen. They also have to face up to the reality that EV’s are not going to cut into gasoline demands nearly as badly as many had predicted.
US production had fallen to 13.1 million barrels a day in part because (EIA) may have been over-reporting it in the first place, The EIA said that this week’s domestic crude oil production estimate incorporates a re-benchmarking that decreased estimated volumes by 177,000 barrels per day, which is about 1.3% of this week’s estimated production total.
The EIA that gasoline supplies falling significantly is going to create further challenges for US refiners if they are going to rise to the occasion to meet the demand which is much better than the International Energy Agency has been telling them it would be.
The EIA said that “U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 1.5 million barrels from the previous week. At 447.0 million barrels, U.S. crude oil inventories are about 3% below the five-year average for this time of year. Total motor gasoline inventories decreased by 5.7 million barrels from last week and are about 3% below the five-year average for this time of year. Both finished gasoline and blending components inventories decreased last week. Distillate fuel inventories increased by 0.9 million barrels last week and are about 7% below the five-year average for this time of year.”
Gasoline demand rose again last week as supply tightened, Gas demand week over week hit 9,044 million barrels a day up 30,000 barrels from the week before.
The EIA said that total oil product demand based on products supplied over the last four-week period averaged 19.9 million barrels a day, up by 1.0% from the same period last year.
Over the past four weeks, motor gasoline product supplied averaged 8.7 million barrels a day, down by 1.3% from the same period last year but up over last week.
Distillate fuel product supplied averaged 3.7 million barrels a day over the past four weeks, up by 0.5% from the same period last year.
Jet fuel product supplied was up 2.0% compared with the same four-week period last year.
Natural gas producers are in bad shape with historically low prices and spot prices that have gone negative. The question is will we be able to cut back production enough to save some of the producers,.
The EIA said that Winter storms have disrupted U.S. natural gas production ›
Over the last four winters, winter storms Uri (February 2021), Elliott (December 2022), and most recently, Heather (January 2024) interrupted weekly U.S. natural gas production by more than 15 billion cubic feet per day (Bcf/d), according to daily estimates from S&P Global Commodity Insights. These declines were the largest interruptions to U.S. natural gas production during the past four years.
Although the impacts of these disruptions appear more muted over a month, winter storms Uri and Elliott still drove declines in monthly average natural gas production of 3 Bcf/d to 7 .
Read Full Story »»»
DiscoverGold
Natural Gas Retreats from Recent Highs, Eyes Key Support Levels
By: Bruce Powers | March 13, 2024
• Natural gas prices retreat further from recent highs, indicating that sellers remain in chart. Key support levels at 1.63 and 1.58 should hold if it is to have a chance to rally.
Natural gas continued to pull back on Wednesday from the recent 2.01 swing high hit last week. Today’s decline put it below yesterday’s low and at a new retracement low of 1.65. It looks to be on its way to the 78.6% Fibonacci retracement at 1.63, while the previous pullback low is at 1.58.
Long-term Downtrend Dominates
The long-term pattern in natural gas is a downtrend. Last week’s high found resistance at previous support, which is typical price action in a bearish environment. Further weakness is seen this week as both the 20-Day MA and 61.8% Fibonacci level failed to stop the decline. Further, a bearish signal occurred on a drop below last week’s low of 1.755. If support is seen around the 78.6% retracement followed by a bullish reversal, a rally may follow to test last week’s highs and possibly exceed them. The trend low was at 1.52 and it was in a price zone where long-term support was seen in the past.
Sitting at Long-term Support Range from 1.64 to 1.44
Specifically, support was seen in 2016 and then again in 2020. In 2020 the price of natural gas hovered around a price range from 1.64 to 1.44 for about six months. During the recent decline the lower prices of the range were not reached but they may still be. The next indication that the price of natural gas is getting weaker would occur on a drop below the weekly low of 1.59 and then the daily minor swing low at 1.58.
Bullish Reversal off Support Could Lead to Another Rally
If support is seen above the weekly low, followed by a bullish reversal, natural gas may rally again to test resistance levels. Initially, a test of the lower line of the declining blue dashed parallel trend channel is anticipated. That could lead to another lower swing high. That lower line has been recognized by the market several times starting with the December 13 swing low. Although it will likely be resistance again a decisive breakout above the line could lead to an eventual advance above the 2.01 swing high and further up into the channel.
Read Full Story »»»
DiscoverGold
Cocoa continued its parabolic move by surging above 7,000 for the first time in history
By: Barchart | March 13, 2024
• Cocoa continued its parabolic move by surging above 7,000 for the first time in history.
Read Full Story »»»
DiscoverGold
Naive. The Energy Report
By: Phil Flynn | March 13, 2024
I guess if you believed some of the energy narratives over the last couple of years you must be naïve, I guess. Claire Coutinho, the UK’s Secretary of State for energy security and net zero, stated as much today when she said: “Anyone who tells you that we can just stop oil and gas is not just wrong but naive”. Well, that’s a little harsh. It is kind of like when the Biden administration tells you that gasoline prices are coming down, even though they are not, unless you adjust for inflation, that they tell you are going down, even though it isn’t.
Not only did we see the Consumer Price Index (CPI) come in higher than expected we also saw that the Energy Information Administration (EIA) sharply raised its gasoline price forecast on a day when the American Petroleum Institute reported a rather large 3.75 million barrel drop in weekly supply as refinery issues and better than expected demand significant are tightening supply. This is against a bullish backdrop of a bigger than expected 5.521 million barrels drop in crude oil supply a 1.162 million barrel drop in distillate and a 998.00 barrel drop in supply at the Cushing, Oklahoma delivery point. The CPI came up 0.4% for the month and 3.2% from a year ago. The core CPI rose 0.4% on the month and was up 3.8% on the year.
This came out before that EIA predicted that the U.S. average retail gasoline price will be about $3.50 per gallon this year, almost 20 cents/gal higher on an annual average basis in 2024.
It is also like telling the International Energy Agency that it was flat out ridiculous to tell the world to stop investing in fossil fuels immediately in a nod to the green energy lobby. A call that was widely panned as either extremely stupid or at the very best, naïve. Yet The IEA seemed to remember that their mission is energy security and not green energy lobbying.
It seems that the International Energy Agency (IEA) had a moment of clarity that OPEC was very keen to point out. In a report, OPEC put out a note called, “Oil Security: vital for All” OPEC called out the IEA by saying “We took note of the International Energy Agency (IEA) reaffirming the significance of oil security to energy transitions in its most recent commentary: “A strong focus on oil security will be critical throughout the clean energy transition”. In other words, OPEC was taking a victory lap because the International Energy Agency (IEA) had to backtrack from some of the ridiculous naive projections about supply and demand in the need for fossil fuels.
OPEC wrote, “At OPEC, we are encouraged by this message and the reference to the continuing importance of oil to the world. The IEA says in its commentary: “An enduring focus on oil security is a consequence of the continued need for oil to fuel cars, trucks, ships, and aircraft, as well as to produce the petrochemicals necessary to manufacture countless everyday items”. OPEC has strongly voiced these messages for many years, and we will continue to reiterate that energy security, energy affordability, and reducing emissions need to go hand-in-hand, as we look to an all-energies, all-technologies and all-peoples approach to energy transitions. OPEC also said that, “it is important to stress that the IEA’s talk of the need for no new oil and natural gas fields in its net zero pathway has contributed significantly to this uncertainty, which has the potential to lead to major energy chaos, not the desired energy security.”
Oil also found support because of more Ukrainian drone attacks on Russian oil facilities. Yesterday a report that a Russian refinery was on fire raised concerns about the ability of Russia to produce more oil. At the same time a report that Amos Hochstein of the Biden administration’s Special Presidential Coordinator for Global Infrastructure and Energy Security. He is working with India to allow them to buy more oil from Russia. So let me get this straight. We are trying to put sanctions on Russia but at the same time helping India buy more Russian oil. Mr. Hochstein said it isn’t about not allowing the oil to get out it’s only to make sure that India buys it at a low price. I wish that they would put in policies in the United States that would allow us to buy oil at a low price. Sort of like getting off the back of the US oil and gas industry. But maybe I am naïve.
This comes as the EIA had other bullish things to say about the state of the oil markets. The EIA raised its s 2024 WTI crude spot price to $82.15/bbl from $77.68/bbl. They also raised their forecast for 2024 World oil demand growth by 10,000 bpd, now seeing 1.43 mln bpd year-on-year increase. They also raised the forecast for 2025 world oil demand growth by 90,000 bpd, now seeing a 1.38 mln bpd year-on-year increase. They also raised its US EIA lifted 2024 spot Brent oil forecast to $87/bbl from $82.42/bbl.
While the prospects for oil look great, the prospects for natural gas and US gas producers look bleak. The EIA reported that, “Natural gas prices are expected at the Henry Hub spot price to remain below $2.00 per million British thermal units (MMBtu) in 2Q24 as the winter heating season ends with natural gas inventories 37% above the five-year average. The Henry Hub spot price averaged $1.72/MMBtu in February (30% lower than in our February STEO), a record low adjusted for inflation. Low prices were partially driven by reduced natural gas consumption in the residential and commercial sectors this winter. Natural gas production they say remained unchanged in March from February at just under 104 billion cubic feet per day (Bcf/d).
We expect lower natural gas prices to cause slight declines in natural gas production for the remainder of the year, and we do not expect that natural gas production will return to its December 2023 record of 106 Bcf/d during the forecast period. Forecast U.S. dry natural gas production averages 103 Bcf/d in 2024, down slightly from 2023. Production increases to 104 Bcf/d in 2025, driven by expected growth in associated natural gas production in the Permian Basin and growth in LNG export demand.
Yet we expect there will be a drop in production bigger than the EIA believes. CNX, which is an Appalachian gas producer, is reducing its natural gas production in 2024 and announced delays for well completions on at least three sale pads. Other natural gas producers have to fight off the potential of bankruptcy as they are losing money. Not only do they have to pay the royalty rates and leases, they also have to pay for their drilling and their employees and their loans to the bank and they can’t do that when gas prices are almost negative.
HFIR says that, “While we believe that the bottom ($1.50/MMBtu) will hold, low gas prices are needed to tighten balances going forward. At ~102 Bcf/d, injection gas balances point to a deficit of 1.5 Bcf/d. This would push storage to ~4 Tcf by November.
Read Full Story »»»
DiscoverGold
I was also looking at Corn last week and was looking for ETFs...#natgas is also coming close to a bottom and I would like to explore futures opportunities...
Natural Gas Bearish Momentum Targets Lower Fibonacci Levels
By: Bruce Powers | March 12, 2024
• Natural gas price action shows bears in control as it retraces further, with potential to test recent lows around 1.58 to 1.52, unless a bullish reversal occurs.
Natural gas further retraces its recent advance, falling to the 61.8% Fibonacci retracement with the day’s low of 1.69. Downward pressure remains as continues to trade near the lows of the day at the time of this writing. If it keeps falling the next Fibonacci level at 1.63 becomes the likely next lower target. That price is the 78.6% Fibonacci retracement level. Today’s price action shows the bears in charge and aligned with the larger bearish trend.
Bears Remain in Control
A bearish continuation of the long-term downtrend, begun from the August 2023 peak at 10.03, triggered initially on December 4 with a breakdown from a rising parallel trend channel. Further confirmation for the continuation of the bear trend to a new trend low triggered on February 8. Subsequently, support was eventually found at the 1.52 trend low seen several weeks ago. That low led to a rally to test resistance where support was seen earlier in February and April 2023. It was in a range from 1.95 to 1.97. The high of the recent counter-trend rally was 2.01.
Counter-Trend Rally Confirms Bearish Price Structure
The critical resistance zone around 1.95 to 1.97 was clearly tested and price was rejected to the downside from the 2.01 high. Note that the highest daily close during the advance was at 1.95. That seems to indicate that the market recognized the price range. Last week’s high not only successfully tested resistance near prior trend lows. The lower boundary of a falling parallel channel was also successfully tested as resistance. That channel is marked with dashed blue lines. Similarly, the bottom of the channel was clearly resistance following the gap down on January 29.
78.6% Retracement Looks More Likely
To summarize, during the recent countertrend rally natural gas hit resistance at key prior support zones. This is common bearish behavior within the progression of a downtrend. Therefore, since the pullback from the 2.01 high is retracing further, the potential to test recent lows around 1.58 to 1.52 increases. The possibility of natural gas falling below 1.52 remains a possibility. Nevertheless, a clear bullish reversal from the 61.8% or 78.6% retracement zones will put the countertrend rally back in play. As noted yesterday, it may just be that the rally is expanding its swings so that the pattern creates a C point on a rising ABCD pattern.
Read Full Story »»»
DiscoverGold
Agriculture Master Report
By: Bill Moore | March 12, 2024
MAY BEANS
The March WASDE issued Friday at 11am was considered neutral/negative with US stocks higher, Global stocks lower and Brazilian Bean estimates higher! While the report was a ho-hummer, the mkt’s reaction was certainly not with a 20 cent higher close to the highest level in 3 weeks! Conventional wisdom states that the bearish fundamentals (higher stocks & slack exports) were already “in” the mkt – by virtue of the $3.00 break (1420-1120) since November! As well, Brazil is still dry & the ultra-warm winter could portend a “hot & dry” Summer in the US! And the US Dollar looks to be trending lower with the Fed suggesting 2-3 rate cuts this year! Finally, a $10 rally in crude bodes well for biodiesel demand! A sharply higher mkt off a neutral report is always a welcome harbinger!
MAY CORN
Despite the neutral USDA Report on Friday, May Corn was able to maintain its 30 cent rally on Friday’s close! A plethora of positive factors enabled this impressive mkt action including – cheapness (coming off $4.00), Exports – up 35% over 2023, technical – charts key reversed up, weather – a very warm winter might extend to summer & predicted corn acres are running 3-4 mill acres under last year! The real headscratcher from Friday is the USDA’s stubborn refusal to bring down their Brazil Bean estimate – 155mmt – closer to Conab’s 145mmt! Exports are starting to flow with occasional corn sales to Mexico! the report everyone is waiting for comes on Thursday March 28 at 11am – the Quarterly Stocks & Acreage Report!
MAY WHT
“It looked so bad it was good” is an old commodity cliché that may well apply to all 3 wht contracts this morning – Minneapolis, Kansas City & Chicago! CBOT Wht has rallied interday 25 cents after starting lower after the 3rd consecutive Chinese cancellation of a US wht order, non-threatening weather for US & Russian wht crops & a sluggish export pace! This kind of mkt action often signals a low – but its perilous to predict that in a mkt that seemingly has no low! But maybe with the help of it sister mkt’s corn & bean rallies, wht is finally carving out a low! We’ll know later in the week! Certainly, no one is disputing the fact that wht prices are already plenty cheap enough!
APL CAT
April Cattle is real enigma! Take Friday’s action for instance! The mkt made new highs Inter-day – then key reversed to close lower – despite very tight supplies & cash cattle mkt up $2.00 for the week! But all it’s done since mid-December is go up or consolidate within $2-3 off its recent highs! The tight supplies & expected solid demand into the Easter weekend 3-30/3-31 will most certainly extend this trading pattern!
APL HOGS
April Hogs are not blessed with the bullish fundamentals of its “sister mkt” April Cattle – whose very tight supplies continually underpin the mkt! The April Hog contract has corrected $5.00 (88.50-83.50) due to a large net long position partially liquidating as support levels are violated & a lower slaughter rate -suggesting a slowdown in packer demand! However, the USDA pork cut-out Mon was up $1.40! And with the Easter Holiday (3-31-24) & the grilling season fast approaching, we feel demand will grab this mkt & push it back up to its early March highs!
Read Full Story »»»
DiscoverGold
Grains Report: Wheat, Rice, Corn and Oats, Soybeans, Canola and Palm Oil
By: Jack Scoville | March 12, 2024
• WHEAT
General Comments: Wheat was higher yesterday and trends started to turn up in these markets. It looks like the current prices have accounted for most or all of the bad news to hit Wheat futures. USDA made no changes to its balance sheets last week. Big world supplies and low world prices are still around. Export sales remain weak on competition from Rusia, Ukraine, and the EU as those countries look to export a lot of Wheat in the coming period. It is warm in the US and Canada this week. Black Sea offers are still plentiful.
Overnight News: The southern Great Plains should get mostly dry conditions. Temperatures should be above normal. Northern areas should see mostly dry conditions. Temperatures will average near normal. The Canadian Prairies should see mostly dry conditions. Temperatures should average near normal.
Chart Analysis: Trends in Chicago are mixed. Support is at 539, 528, and 524 May, with resistance at 554, 560, and 572 May. Trends in Kansas City are mixed to up with objectives of 612 and 634 May. Support is at 591, 581, and 568 May, with resistance at 5608, 617, and 633 May. Trends in Minneapolis are mixed to up with objectivesof 688 and 712 May. Support is at 660, 641, and 635 May, and resistance is at 675, 681, and 688 May.
• RICE
General Comments: Rice closed a little lower yesterday and trends remain down in this market. Good demand for export continues. The overseas markets feature less production in Brazil and India and it appears that the lack of offer from these markets is supporting increased demand for US Rice and prices here in the US. Warmer and wetter weather is expected this week and next on the Delta and Texas and soil moisture conditions for the next crop should improve.
Overnight News:
Chart Analysis: Trends are down with no objectives. Support is at 1773, 1759, and 1751 May and resistance is at 1803, 1827, and 1845 May.
• CORN AND OATS
General Comments: Corn was higher yesterday on follow through buying from last week, and trends are up on the daily charts. USDA on Friday made no important changes to the monthly balance sheets and international data did not change that much, either. Big supplies and reports of limited demand are still around, but futures have been very oversold. Futures are much lower than just a few months ago and a short covering rally is increasingly expected and might be under way. Funds remain very large shorts in the market. Basis levels have started to firm in the US as processors look for supplies amid tight farmer holding patterns. The weather forecasts for Argentina are improving with more showers and rains expected this week. More rain is forecast for central and northern Brazil The planting progress reports to date indicate rapid progress.
Overnight News:
Chart Analysis: Trends in Corn are up with objective of 450 May. Support is at 433, 429, and 422 May, and resistance is at 446, 448, and 459 May. Trends in Oats are mixed. Support is at 362, 356, and 349 May, and resistance is at 374, 376, and 3769 May.
• SOYBEANS
General Comments: Soybeans and the products closed mostly lower yesterday on ideas of increased offers from Brazil and despite reports of stronger basis levels and great export demand in Brazil. USDA made no significant changes to its US balance sheets on Friday and cut Brazil Soybeans production less than the trade had expected. Report indicate that China has been a very active buyer of Brazil Soybeans in the last week. Ideas that South American production is taking demand from the US have pressured futures lower. Funds remain very large shorts in the market. Basis levels in the country are reported to be firming as processors look for supplies and farmers remain tight holders. Rains are in the forecast in Argentina. Such rains would be beneficial for reproducing Corn and Soybeans.
Overnight News:
Chart Analysis: Trends in Soybeans are mixed to up with objectives of 1193 and 1220 May. Support is at 1165, 1153, and 1140 May, and resistance is at 1192, 1204, and 1214 May. Trends in Soybean Meal are mixed to up with objectives of 344.00 and 353.00 May. Support is at 326.00, 329.00, and 307.00 May, and resistance is at 345.00, 348.00, and 352.00 May. Trends in Soybean Oil are mixed to up with no objectives. Support is at 4610, 4550, and 4500 May, with resistance at 4690, 4730, and 4810 May.
• CANOLA AND PALM OIL
General Comments: Palm Oil was higher yesterday on production problems in Southeast Asia and as the export pace is expected to really improve. Domestic biofuels demand is also likely to improve. Ideas of weaker production ideas against good demand still support the market overall. The fundamentals of average demand against a weaker supply outlook are still around to keep prices supported. Trends are up on the daily charts. Canola was higher with Chicago and Malaysia. There are still forecasts for better rains in Argentina after a dry spell ends in a week or so and improving weather in Brazil. Current forecasts call for generally improved growing conditions in Brazil this week. The Canola crop is harvested, and it is in bins, so it will take some price movement to get new farm sales.
Overnight News:
Chart Analysis: Trends in Canola are up with objectives of 632.00 and 662.00 May. Support is at 602.00, 594.00, and 585.00 May, with resistance at 621.00, 629.00, and 638.00 May. Trends in Palm Oil are up with objectives of 4150 May. Support is at 4050, 4000, and 3960 May, with resistance at 4140, 4170, and 4200 May.
Midwest Weather Forecast Mostly dry conditions. Temperatures should average near to above normal.
Read Full Story »»»
DiscoverGold
Softs Report: Cotton, OJ, Coffee, Sugar, Cocoa
By: Jack Scoville | March 12, 2024
• COTTON
General Comments: Cotton closed a little higher yesterday in recovery trading and on the changes made by USDA in its WASDE updates on Friday. USDA cut domestic production and increased demand for reduced ending stocks estimates. It also increased demand from India and China in the world estimates. It is too early to plant in Texas but the heat and dry weather raises concerns about production potential later in the growing season and blackened soils might not permit much planting, anyway. The demand news has been solid in this market for the last several weeks. The US economic data has been positive, but the Chinese economic data has not been real positive and demand concerns are still around. There are still many concerns about demand from China and the rest of Asia due to the slow economic return of China in the world market.
Overnight News: The Delta will get mostly dry weather and near normal temperatures. The Southeast will see mostly dry conditions and below normal temperatures. Texas will have mostly dry conditions and near to above normal temperatures. The USDA average price is now 89.52 ct/lb. ICE daily certified stocks are now 21,233 bales, from 21,233 bales yesterday. ICE said that 1 contract was posted for delivery against March futures and that total deliveries for the month are now 10 contacts.
Chart Trends: Trends in Cotton are mixed. Support is at 92.50, 90.90, and 88.10 May, with resistance of 97.70, 98.40 and 100.50 May.
• FCOJ
General Comments: FCOJ closed lower yesterday on follow through selling as USDA increased its US production estimates for Oranges slightly on Friday. The daily and weekly chart trends are mixed. Prices had been moving lower on the increased production potential for Florida and the US and also in Brazil but held late last week as current supplies remain very tight amid only incremental relief for supplies is forecast for the coming new crop season. There are no weather concerns to speak of for Florida or for Brazil right now. The weather has improved in Brazil with some moderation in temperatures and increased rainfall amid reports of short supplies in Florida and Brazil are around but will start to disappear as the weather improves and the new crop gets harvested.
Overnight News: Florida should get scattered showers or dry conditions. Temperatures will average near normal. Brazil should get scattered showers and above normal temperatures. ICE said that 0 notices were posted for delivery against March futures and that total deliveries for the month are now 300 contracts.
Chart Trends: Trends in FCOJ are mixed. Support is at 350.00, 343.00, and 335.00 May, with resistance at 369.00, 378.00, and 389.00 May.
• COFFEE
General Comments: New York and London closed lower Friday but chart trends are up in both markets. Robusta offers remain difficult to find and the lack of offer of Robusta is a bullish force behind the market action, and reports indicate that Brazil producers are reluctant sellers as well as they apparently have already sold a lot. Brazil weather continues to improve for Coffee production and conditions are called good. Rains continued to fall in parts of Brazil Coffee areas. Brazil weather is good for the best crop production.
Overnight News: ICE certified stocks are higher today at 0.424 million bags. The ICO daily average price is now 185.10 ct/lb. Brazil will get mostly scattered showers with near normal temperatures. Central America will get mostly dry conditions. Vietnam will see scattered showers. ICE NY said that 0 delivery notices were posted against March contracts and that total deliveries for the month are now 974 contracts.
Chart Trends: Trends in New York are mixed to up with objectives of 201.00 May. Support is at 182.00, 180.00, and 178.00 May, and resistance is at 190.00, 194.00 and 196.00 May. Trends in London are mixed to up with objectives of 2550 May. Support is at 3250, 3220, and 3190 May, with resistance at 3330, 3360, and 3390 May.
• SUGAR
General Comments: New York and London closed higher yesterday and trends are turning up on the daily charts. Ideas of weaker demand are around the market and are causing the selling, but producers do not appear to be selling much. The market continues to see stressful conditions in Asian production areas. There are worries about the Thai and Indian production. Offers from Brazil are still active but other origins. are still not offering in large amounts except for Ukraine.
Overnight News: Brazil will get rains in the south and scattered showers in the north. Temperatures should average above normal. India will get mostly dry conditions and below normal temperatures.
Chart Trends: Trends in New York are mixed to up with objectives of 2250, 2360, and 2390 May. Support is at 2110, 2050, and 1930 May and resistance is at 2200, 2260, and 2290 May. Trends in London are mixed to up with objectives of 630.00, 654.00, and 676.00 May. Support is at 610.00, 597.00, and 590.00 May, with resistance at 624.00, 638.00, and 650.00 May.
• COCOA
General Comments: New York and London were higher and chart trends began to turn up again and reflect the lack of supply in the world market as well as demand from nontraditional sources along with traditional buyers. Production in West Africa could be reduced this year due to the extreme weather which included Harmattan conditions. The availability of Cocoa from West Africa remains restricted and projections for another production deficit against demand for the coming year are increasing. Ideas of tight supplies remain based on more reports of reduced arrivals in Ivory Coast and Ghana continue. Demand continues to be strong, especially from nontraditional buyers of Cocoa.
Overnight News: Isolated showers are forecast for West Africa. Temperatures will be near normal. Malaysia and Indonesia should see scattered showers. Temperatures should average near normal. Brazil will get isolated showers and above normal temperatures. ICE certified stocks are lower today at 4.116 million bags. ICE NY said that 0 notices were posted for delivery against March futures and that total deliveries for the month are now 1,007 contacts.
Chart Trends: Trends in New York are mixed to up with objectives of 6850 May. Support is at 6470, 6290, and 6200 May, with resistance at 6800, 6860, and 6920 May. Trends in London are mixed to up with no objectives. Support is at 5040, 4020, and 3900 May, with resistance at 5620, 5720, and 5840 May.
Read Full Story »»»
DiscoverGold
Cracked Up. The Energy Report
By: Phil Flynn | March 12, 2024
Oil prices rebounded yesterday as it appears that gasoline supply is not all it’s cracked up to be. There are lingering concerns about the tightness of supply in the Midwest in the aftermath of the Whiting BP refinery outage as well as another refinery outage.
Reuters reported that the coker and small crude distillation unit (CDU) were shut by a leak on the gasoline-producing fluidic catalytic cracker (FCC) at Total Energies’ 238,000 barrel per day Port Arthur, Texas refinery, causing the gasoline crack spread to rise and causing tightness and many of the physical gasoline delivery points. Yet underneath it, the fact that the supplies of gasoline crude oil and diesel fuel are below average here and around the world against a backdrop where OPEC is cutting production, is setting the stage for yet another rally as the market heads into the summer driving season.
The rising gasoline prices along with today’s consumer price index could be a key determining factor into how many times the Federal Reserve will cut interest rates this year. We know that at least one rate cut is on the table because the Federal Reserve, going into an election year, could not possibly cut rates after making that promise. At the same time, if it’s a one cut and done it’s possible that we could see a rebound in the dollar. In recent days the dollar has been lower.
The gasoline price situation will not win voters’ favor with the Biden administration that they realize has had an impact on rising gasoline prices. The Keystone Pipeline that Biden killed would have been up and running by now. It would have moved oil from Canada in a much more efficiently manner to US refineries and out to the rest of the world. That pipeline would have moved oil more safely and more efficiently and because the oil is heavy it would have also played a big role in that helping the world rely more on Canadian oil. Instead, the world has turned to Russia to fill that heavy oil void.
Biden of course did not think these things through when he killed the Keystone Pipeline purely for political reasons. The Keystone Pipeline was not about the environment, it was not about jobs for the United States. It was all about making a political statement that there was a new sheriff in town and this new sheriff was going to crack down on fossil fuels.
The killing of the Keystone Pipeline was also to restrain investment in the United States. The ESG movement along with regulatory uncertainty has set the stage for US oil production peak. Instead of increasing refining capacity to take advantage of the US shale production, Biden discouraged that by saying they wanted to replace fossil fuels. Those people who believe that Biden’s policies were OK for the US oil and gas industry really haven’t talked to people in the US oil and gas industry. Those who point to record US production is evidence that Biden’s policies had no impact on US production, must realize that it takes years and massive investment to make that production happen. Now with new taxes on oil and gas producers proposed by this administration and even more taxes on the wealthy, the boom that we have seen that has been built up over decades will start to reverse.
Still it’s worth noting that, “The United States produced more crude oil than any nation at any time, according to The Energy Information Administration International Energy Statistics, for the past six years in a row. Crude oil production in the United States, including condensate, averaged 12.9 million barrels per day (b/d) in 2023, breaking the previous U.S. and global record of 12.3 million b/d, set in 2019. Average monthly U.S. crude oil production established a monthly record high in December 2023 at more than 13.3 million b/d. The crude oil production record in the United States in 2023 is unlikely to be broken in any other country in the near term because no other country has reached production capacity of 13.0 million b/d. Saudi Arabia’s state-owned Saudi Aramco recently scrapped plans to increase production capacity to 13.0 million b/d by 2027.
Together, the United States, Russia, and Saudi Arabia accounted for 40% (32.8 million b/d) of global oil production in 2023. These three countries have produced more oil than any others since 1971 (counting production in the Russian Federation of the Soviet Union prior to 1991), although the top spot has shifted among them over the past five decades. By comparison, the next three largest producing countries—Canada, Iraq, and China—combined produced 13.1 million b/d in 2023, only slightly more than what was produced in the United States alone.”
Yet those in the Biden administration should not try to take credit for what has happened because of years of hard work, ingenuity, investment that happened long before Biden came into office. Most people in the energy industry will tell you that Biden and his policy is creating an energy crisis that is going to happen in the future mainly because of the short-sighted policies by this administration.
Of course one the key thing in the short term that will move the price of oil will be today’s consumer price index but we really have to focus on U.S. oil inventories as well. We expect to see a drawdown in crude supplies by 2,000,000 barrels and product supply by 2,000,000 barrels as well. We’re starting to see gasoline inventories tighten significantly especially in the Midwest and we’re starting to see diesel supplies be squeezed. We’re lucky we had a warm winter because once again diesel supplies could have been much tighter than they already are. But the thing you must really keep an eye on is where we go from this point forward. As this summer driving season is coming around and even if we get a soft consumer price index in this report, the possibility of a price jump forecast is very high.
Geopolitical risks are still high. Reports that we’re seeing more bombing in Gaza has caused Iranian backed Houthi rebels to vow to continue their acts of terror in the Red Sea. Hot inflation and fiscal uncertainty is driving investment in cryptocurrencies, gold, silver and platinum. Palladium also has had an incredible ride along with a very tight supply of iron ore. Physical commodities are tight and that could drive commodities that are undervalued in many ways compared to the rest of the market.
Natural gas producers are going to feel more pain as natural gas spot prices fell to the lowest level since October of 2020. According to natural gas collector, the previous 2024 low was $1.37 on February 26. Obviously, they’re pointing to warm weather and that still presents a challenge to the physical price premium as prices flipped into the negative for the second time this month. Free gas, no place to go.
There are reports that China’s liquefied natural gas imports are going to rise next year after they already increased by 12.6% last year. With growing global demand for liquefied natural gas and the fact that the United States could supply gas to the world thereby replacing dirty coal, it makes no sense that Biden has paused reviews of new LNG export facilities. China stock market is also 20% from its lows and the according to Bloomberg News that is fueling predictions that China’s stock market has bottomed out.
Read Full Story »»»
DiscoverGold
Agriculture Daily Market Movers (% Price Change)
By: Marty Armstrong | March 12, 2024
• Top Movers
Cocoa (NYCSCE) Futures 5.19 %
Sugar World (CSCE) Futures 3.78 %
White Sugar ICE Futures 3.28 %
Oats (Minneapolis) 3.07 %
Oats (CBOT) Futures 2.21 %
• Bottom Movers
Eggs 4.89 %
Cheese 2.05 %
Orange Juice (NYCE) Futures 1.98 %
Lean Hogs (CME) Futures 1.3 %
Soybean Meal CBT Futures 1.23 %
*Close from the last completed Daily
DiscoverGold
Natural Gas Further Testing Support Levels
By: Bruce Powers | March 11, 2024
• Natural gas tests key support levels, with potential for a bullish reversal once complete.
Natural gas further tests support around the 20-Day MA (purple) on Monday with a slightly new retracement low of 1.75. It is on track to complete an outside day today as earlier in the session last Friday’s high was exceeded briefly to the upside. The 50% retracement is also near the retracement lows at 1.765. So, there is the 20-Day line and 50% retracement marking potential support along with last week’s low. Since a bullish breakout above Friday has failed, today’s low is also at risk of failure to the downside. This doesn’t mean it will fail, just that the chance it could do so has increased.
Next Lower Support at 61.8% Fibonacci Retracement of 1.71
If natural gas does break below the current support area it likely heads towards the 61.8% Fibonacci retracement at 1.71. Certainly, that would indicate a failure of the 20-Day MA to maintain support. Also, the 78.6% Fibonacci retracement is at 1.63. Notice that the short-term 8-Day MA line has turned down since Friday, thereby providing an indication of weakness. An initial rising ABCD pattern completed last week at the 161.8% Fibonacci expansion target of 2.02. Last week’s high was 2.01. The subsequent reaction of price tells us it is done. Therefore, the market needs to set up for the next potential advance. A retracement low may still be established near today’s low, or a drop to lower price levels comes first.
Bullish Reversal Anticipated Once Retracement is Complete
Nonetheless, the recent swing low from February 20 is a solid low and there remains the possibility that the rally off that low will continue once the developing up trending pattern expands with a new swing low. In other words, the price swings within the developing uptrend becomes larger. Today’s low may be that bottom or the lower levels noted above may be hit first. In general, staying above the 20-Day line shows greater underlying strength than trading and closing below the line.
Breakout Above 1.84 is Bullish
Regardless of the above analysis, a decisive breakout above today’s high of 1.84 provides a bullish signal. If it holds natural gas should rally into last week’s high zone to test it as resistance. An upside breakout above last week’s high of 2.01 confirms strength and thereafter a higher potential target comes into view. The next higher key target has been identified around 2.23. That is where the December swing low was and the 38.2% Fibonacci retracement of an internal downswing. The 50-MA was also at that price earlier but it has come down some to 2.22.
Read Full Story »»»
DiscoverGold
The Corn & Ethanol Report
By: Daniel Flynn | March 11, 2024
We start off the week with NY Fed Treasury Purchases 4.5 to 7 yrs. at 8:30 A.M., Consumer Inflation Expectations at 9:00 A.M., 3-Month & 6-Month Bill Auction at 9:30 A.M., Export Inspections at 10:00 A.M. and 3-Year Note Auction at 11:00 A.M.
Were coming in lower this morning with corn and soybean meal leading the retreat. Soybean oil has the strength as fats & oils are in high demand. Kuala Lumpur palm oil market is peaking to new levels fueled by tight supply and optimism of demand. We opened the week higher as the global markets digested and reacted to the USDA March Crop Report, but profit taking, and lack of export demand allowed prices to back off. A much more important USDA/NASS report will be released in 15 trading days, the March Stocks and Seeding Intentions March 28th, ahead of the 3-day Easter Holiday Weekend.
The South American weather models remain remarkably consistent which raises confidence in forecast. Below normal rains falls across Northern & Central Brazil while soaking rain of 3-6.00” douses NE Argentina into March 21st . This same weather pattern and precipitation outlay is maintained into the 11-15 day period are lower confidence as they were not pulled forward in the forecast over the weekend. A sizable decline in soil moisture is forecast for the northern 2/3’s of Brazil which elevates the importance of late March and April rain for the winter corn crop. Brazilian high temps will reach the 90’s on most days with highs reaching the mid to upper 90’s midweek. The Argentine forecast is nonthreatening except for the soaking rain for Corrientes and Entre Rios where flooding is due to daily heavy rains. No Argentine extreme heat is in the forecast.
Read Full Story »»»
DiscoverGold
Today's Futures Heat Map • Strongest: Cocoa, Bitcoin, Sugar, Platinum
By: Barchart | March 11, 2024
• Today's Futures Heat Map
Strongest: Cocoa, Bitcoin, Sugar, Platinum
Weakest: Natural Gas, Orange Juice, Lean Hogs, Soybean Meal
Read Full Story »»»
DiscoverGold
The Edge. The Energy Report
By: Phil Flynn | March 11, 2024
The crude oil market has been edging lower reluctantly as banking worries and China’s economy and US regional bank concerns are raising demand fears even as global supplies tighten. WTI rejection of $80 a barrel has some wondering whether the move is over. Hedge funds are back, ramping up on the short side of the market trying to keep prices under control. Yet seasonal factors and geopolitical risk factors will keep the market from falling too hard.
Cease-fire hopes were dashed Biden issued a ‘red line’, warning Israel not to attack Rafah. Biden is trying to balance support for Israel against the screaming support for the Palestinians in his party. This is the latest attempt by Biden to appease the lefties in his base.
A pull-back in oil rigs and a cut in US oil investment will start to be felt as we head into the summer driving season and that normally will add 10 to 15 cents a gallon to the prices at the retail levels. This week we are looking for draws in gasoline and distillate as well as crude in a bullish trifecta and another weekly drop in US crude oil production.
China continues to be a source of speculation for the bears. Forget the fact that Chinese refinery reruns are at all-time highs, the state of the Chinese economy is a worry. China’s crude imports were viewed as mixed.
Yet Reuters reported that, “Saudi Aramco Chief Executive Amin Nasser said on Sunday the oil giant was looking at further opportunities to invest in China, where he said oil demand was robust and growing. State-owned Aramco has been ramping up its China presence in a string of deals in refining and petrochemicals, some of them with crude offtake agreements attached. “So far we are in the early part of 2024, demand is healthy and growing in China,” Nasser said on a media call following the release of results that showed net profit falling 24.7% to $121.3 billion on lower oil prices.
China imported 10.74 million barrels a day of crude oil during January-February of 2024 against 10.4 million barrels a day in the corresponding period of 2023, registering a growth of 3.3 percent. The Chinese Lunar New Year holiday and the travel associated with it helped crude oil consumption during these two months according to Hindu Times.
Reuters reported that U.S. energy firms this week cut the number of oil and natural gas rigs operating for the first time in three weeks, energy services firm Baker Hughes (BKR.O), said in its closely followed report on Friday. The oil and gas rig count, an early indicator of future output, fell by seven to 622 in the week to March 8, the lowest since Feb. 16. Baker Hughes said that puts the total rig count down 124 rigs, or 16.6%, below this time last year.
Natural gas is trying to bottom. The market is expected to see more production cutbacks. The announcement by EQT, the largest US natural gas producer, that said it would cut its production by 30–40 billion cubic feet (Bcf) through March 2024 seems to have given the markets a potential bottom and expectations of more production shut-ins.
Read Full Story »»»
DiscoverGold
Cocoa has stolen the show for YTD performance, up 57.39%, followed by cotton, up 17.97% and the Nikkei, up 15.76%
By: Markets & Mayhem | March 11, 2024
• Cocoa has stolen the show for YTD performance, up 57.39%, followed by cotton, up 17.97% and the Nikkei, up 15.76%
Meanwhile, natural gas is down 19.33% and wheat is down 14.21% year-to-date
Read Full Story »»»
DiscoverGold
Funds are ultra-mega-super bearish of Soybean futures here
By: Markets & Mayhem | March 11, 2024
• Funds are ultra-mega-super bearish of soybean futures here.
Read Full Story »»»
DiscoverGold
Futures 1 Week Performance
By: Markets & Mayhem | March 10, 2024
• Last week VIX futures led gains, followed by palladium, ethanol, silver, and canola.
I talked about silver potentially following gold. It looks like that's starting!
On the downside we had rough rice, lean hogs, wheat, and gasoline.
The S&P 500, DAX and 2-year note were flat.
Read Full Story »»»
DiscoverGold
Natural Gas Finds Support, Eyeing Upside Targets
By: Bruce Powers | March 8, 2024
• Natural gas found support at the 50% retracement and 20-Day MA. Bullish signal will occur on rise above today’s high of 1.84.
It looks like natural gas found support today around the 50% retracement and 20-Day MA. Today’s low was 1.755 and you can see how it bounced right off the price zone. That may be the bottom of the retracement given that the 20-Day line was tested as resistance on Tuesday, February 27. If successful, today’s low would be the first successful test of the 20-Day MA as support then. A further bullish signal could lead to a test of the recent 2.01 swing high and higher targets.
Successful Test of Support at the 20-Day Moving Average?
Prior to February 38 natural gas had been below the 20-Day MA since the drop on January 18. Traditionally, once prior resistance is successfully tested as support in a developing uptrend, the uptrend, in this case a counter-trend rally, may be ready to proceed. If that is the case with natural gas a bullish signal will be generated heading into next week on a rally above today’s high of 1.84.
Highlighting 2.24 Price Target
If the rally from the 1.52 swing low continues into new trend highs, there are interim price levels to watch on the way up. However, the market seems to be highlighting the 2.24 price area as a potential target. There are three pieces of analysis pointing to that price area. The 50-Day MA has recently converged with the 38.2% Fibonacci retracement of the full decline starting from the January 9 peak and they converge at the support area seen at that 2.235 swing low from mid-December.
Nonetheless, to reach 2.24 natural gas will first have to rise above the recent high of 2.01 and then exceed potential resistance up to a second 38.2% Fibonacci retracement level at 2.04. Beyond the 50-Day MA is the 200-Day MA at 2.61. It can be combined with the 61.8% Fibonacci retracement at 2.68, generating a price zone from 2.61 to 2.68.
Weakness on Drop Below 1.755
Regardless of the above bullish scenario, a decline below today’s low of 1.755 could lead to a deeper retracement. The 61.8% Fibonacci retracement is at 1.71. It provides a price level to watch for signs of support on the way down if that scenario does unfold.
Read Full Story »»»
DiscoverGold
Natural Gas Price Forecast: Potential Retracement to 1.76/1.70 Support Zone
By: Bruce Powers | March 7, 2024
• Natural gas faced resistance at 1.95 - 1.97, likely heading towards support at 1.76/1.70. Short-term patterns hint at a potential reversal soon.
Following an inside day breakdown natural gas enters a deeper pullback from the recent 2.01 trend high. That high stuck resistance around the long-term downtrend line and previous trend lows, now resistance at 1.95 – 1.97. The 8-Day MA did not show signs of support as natural gas fell right through it and looks to be on its way to the prior swing high at 1.79 and possibly lower.
Maximum Retracement Possible to 1.76
The next lower likely price support area looks to be around 1.76/1.77. The 50% retracement is at 1.755 and the 20-Day MA is at 1.70. That zone could be the maximum for this retracement. Certainly, that would be a spot for it to happen.
Short-term Pattern Stands Out
There is one short-term price pattern that stands out and may or may not mean anything. We’ll know soon. The first pullback from the 1.79 swing high begins with the open to close range of the day occurring within the body of the previous day. Let’s call it a partial inside day. Then there was one wide range accelerated decline seen as a full-bodied red candle. The low of that day turned out to be the completion of the retracement. Similarly, the recent 2.01 swing high was followed by an inside day. Now today, Thursday, there is a sharp retracement likely to end with a large red candle. Might we see something similar next?
Weekly Chart Analysis
One more piece of that analysis to add can be seen on the weekly chart (not shown). Given today’s decline, it is currently on track to end with a weekly bearish shooting star candlestick pattern. However, if today’s low turns out to be the low or close to the low of the retracement, and it is followed by bullish price action, the weekly candlestick pattern may not end as bearishly.
Watching Price Action Relative to 20-Day MA Closely
The reaction of price around the 20-Day MA should provide a clue about underlying strength that could support a advance higher. Or help determine if the recent high completed an ABCD counter-trend rally in a downtrend and the bearish sentiment remains dominant.
Read Full Story »»»
DiscoverGold
Followers
|
89
|
Posters
|
|
Posts (Today)
|
0
|
Posts (Total)
|
8878
|
Created
|
05/01/07
|
Type
|
Free
|
Moderators DiscoverGold Pro-Life |
- The Commodity Bull is Running... Inflation is Running... Harder Living (i.e. FOOD, CLOTHING, SHELTER) is Dead Ahead... -
- Commodity Futures Trading -
http://finviz.com/futures_performance.ashx
All Commodity Futures Charts From Finbiz.com Available Below:
Daily
Weekly
Monthly
Quarterly
6 Months
12 Months
YTD
2 Years
5 Years
Max
Beneficial Educational Resources on Futures TradingThe futures market is volatile, and it cuts both ways. Leverage that makes it profitable can also ruin reckless, undisciplined traders overnight. Most brokers have paper trading available on their platforms, so those who are new to futures should take advantage and learn with these tools before going live with real money. Mitigate risk with stop loss orders at all times, and cut losses quickly instead of adding contracts and attempting to flip your way out of a losing position. Also, use mini instruments when available, with lower margin requirements, until you have sufficient capital to buy and sell more expensive contracts. Even though the potential is there, don't try to make too many profits at once. If things aren't going well, often times quitting for the day and collecting one's thoughts is the best decision. New opportunities come along daily. Markets are open nearly 24 hours, so set a schedule and stick to it. Avoid trading while tired or distracted, and please don't listen to the advice of others. Do research on fundamentals affecting markets as well as paying attention to TA. Watch key indices, and listen to accurate, real-time news during the session to stay aware of shifting trends. Trade smart, trade safely, and have fun.
Videos on Futureshttps://www.youtube.com/playlist?list=PL9A5C5A93D243CA44 Continuous Improvement in Progress |
Commodity Futures Trading
https://www.tdameritrade.com/investment-products/futures-trading.page
Volume | |
Day Range: | |
Bid Price | |
Ask Price | |
Last Trade Time: |