Commodity Corner: Morning Comments

Good morning,


DXU9  96.255  -0.019                       GCQ9  1418.8  +10.8                                                                 ESU9  2986.50  +7.00                      CLQ9  56.68  +0.43


The markets move towards the mid-week Independence Day holiday with a few things to contemplate.  Oil prices collapsed in yesterday’s trade, as the market moved past the OPEC+ decision to keep production quotas in place into Q1 of 2020.  Global economic growth concerns, hurting demand pressured prices.  Manufacturing indices from the US, Europe and China have all come in a bit softer than expected, stemming these concerns.  Also, talk that Saudi Arabia and Russia were at odds over even deeper production cuts worried the oil market as well.  Gold also had a big correction, taking prices back up to within a whisker of the old highs.  Rumors surrounding Vice President Pence’s airplane yesterday put markets on edge midday.  Later, President Trump announced his 2 nominees for the vacant Fed positions, both of whom are on the dovish side of thinking.  This brought a bid to gold, as markets interpreted this as possibly seeing the Fed being more aggressive on cutting rates in the future.  Of course, there is the minor obstacle of Trump’s nominees actually getting confirmed.  Gold has rotated back down $20 in the European trade, but it is still up $15 from yesterday’s settle. 


Grain markets are firming this morning, as, SURPRISE!, another wave of rain sweeps across the Midwest.  More risks of flooded fields are out there, and this will bring some delays to the winter wheat harvest.  These markets will continue to monitor the weather and mark time ahead of next Thursday’s WASDE report from the USDA.  Grain futures stop trading at noon CDT today, and remain closed until Friday morning at 8:30 AM.  So any needs to hedge with limited access to markets over the holiday may impact the trade. 


Coffee futures had a correction yesterday, after consecutive days of trading higher on frost concerns in Brazil.  Prices are back up again today, as the frost concerns return.  Other markets are observing a range trade, in lighter volumes ahead of the holiday, taking cues from the back and forth price action of the dollar.  Many markets/exchanges have abbreviated trading sessions today, due to the holiday, so make sure you check the closing time of trade in any products you are dealing in. 


In spite of the holiday, it is a fairly busy day, data wise in the US today.  The ADP Employment Index will be released this morning, which hopefully will provide clues about Friday’s Non-Farm Payrolls report.  Trade Balance, Jobless Claims and Non-Manufacturing Purchasing Managers survey are also released.  This will keep the potential for active trade alive for a good portion of the morning, before the fireworks and barbeque mentality kicks in. 


Have a happy and safe 4th of July!              


Technical Moving Averages:

Product               50 day                100 day               200 day

SX9                      887.50                   912.75                   924.75                  

CZ9                      419.00                   406.50                   403.25

WU9                    492.00                   486.50                   516.75

KWU9                  448.25                   456.50                   503.00

MWU9                547.00                   554.25                   577.00

SMZ9                   315.6                     317.3                     319.0

BOZ9                   28.29                     29.42                     29.72

CLQ9                    58.87                     59.46                     59.41

GCQ9                   1323.9                   1319.5                   1293.1

LHQ9                   87.720                   88.440                   84.860

LCQ9                    107.110                 111.940                 112.670

KCU9                    98.70                     100.20                   108.75

CCU9                   2409                       2356                       2317

CTZ9                    68.77                     71.77                     73.89

SBV9                    12.49                     12.83                     12.98

JOU9                    103.90                   113.00                   125.55

HGU9                  273.15                   282.20                   279.45


Have a good day,





Michael Clifford


141 W Jackson Boulevard                             

Ste 1065                                                              

Chicago, IL 60604                                              

Trean Group, LLC