In the Energy markets, Crude oil ended the day Thursday down $1.46 at $107.89 despite a surprise draw down in stocks. This was due to a rally in the dollar index making a new high for the move. Energies as a whole are in a downtrend and strength is to be sold rather than weakness bought until the pattern changes.
Technically, support in the October contract is $104.50 with resistance near $113.00.
An Allendale Trade Idea would be to Sell 1 October Mini-Crude at $112.85 and risk the trade to $116.10 with an objective price of $104.85 used to take profit.
In the Precious Metals markets, the precious metals started the day Thursday higher on early weakness in the dollar, but found themselves trading lower for the remainder of the session after the dollar rallied back and went higher. Again, these markets are in a downtrend and strength is to be sold.
Technical support in the October Gold contract is seen at $790 and then at $775 with resistance at the convergence of the 20 and 10 day moving averages at $820 and again near $840.
A Trade Idea Allendale likes is to Sell 1 October Gold at $824.20 and risk the trade to $838.20 with an objective of $792.20.
The Soft Markets were a mixed bag on Thursday. Sugar, Rice, FCOJ, and Coffee were all up for the day, while Cotton, Cocoa, and lumber were down.
Rough Rice is experiencing strength due to recent flooding from Gustav and at one point in the session; Rice was up the 50-cent limit.
Allendale recommends Buying 1 November Rice at $19.21 stop and risk to $18.89 with an upside objective of $19.91.
We may have seen a major top in the Cocoa market. Again, this market is in a downtrend and we will look to sell strength. Cocoa fundamentals are in a seasonal low until we get more news regarding the West African crop. Cocoa should continue to trade inversely from the Dollar Index.
For those wanting to trade Coca a Trade Idea Allendale has is Selling 1 December Cocoa at 2842 and risk the trade to 2962 with an objective of 2602.
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