Good morning,
DXU9 96.850 +0.305 GCQ9 1415.5 +2.0 ESU9 3020.50 +3.25 CLQ9 59.49 -0.09
The markets remain quiet in front of today’s reading in the US on June Retail Sales. A slight decline from last month’s data is expected. The dollar has a good bid today, which is putting some pressure on commodity prices. Oil is off slightly, with another rejection of a trade above $60 taking place yesterday, aided by oil producers and refiners getting operations going again following Tropical Storm Barry. Grains were firm early yesterday on the hot weather, with corn trading at a 5 year high and soybeans at a 1 year high, but rotated lower as the remnants of Barry are expected to bring some relief to the corn belt. Funds were in liquidating some length in corn and wheat, while adding slightly to a soybean short. Improving crop conditions, as reported yesterday afternoon, along with the stronger dollar are weighing on prices in the overnight trade. Cotton had a large rally yesterday, in part driven up on storm concerns from Barry. It also was correcting from a sharp sell-off following Thursday’s WASDE report. Sugar traded at a 6 week low, and has moved below the $12 level, which has been the bottom of the trading range for some time. Sugar prices traded down on concerns about large deliveries taking place with the expiring August contract. Cocoa prices were down at the lowest levels in 7 months pushed down by demand concerns, as it was reported European cocoa grindings fell for the first time in 2 years. Gold prices remain positive, above the $1400 level, in spite of the stronger dollar today. Market participants are treading the waters very cautiously, with so much uncertainty surrounding the various markets, and gold benefits from the great unknown out there.
There are some potential items that may bring some volatility to the markets. Treasury Secretary Mnuchin said talks with China can resume this week. Anything which provides clues on the Fed’s monetary policy stance. The Middle East is always ripe for tension. Last but not least, President Trump and his Twitter account. As the markets continue to chop around, marking time for the next market moving event, be aware of the moving average levels listed below for numerous products, as these levels can serve as support and resistance areas. The next major event for the markets appears to be the next Fed meeting, on July 31.
Technical Moving Averages:
Product 50 day 100 day 200 day
SX9 892.00 909.50 925.00
CZ9 429.00 410.00 405.25
WU9 502.50 486.00 514.75
KWU9 453.25 451.75 498.25
MWU9 549.00 550.75 573.75
SMZ9 316.9 316.9 319.2
BOZ9 28.27 29.20 29.68
CLQ9 58.01 59.64 59.02
GCQ9 1343.3 1325.3 1300.3
LHQ9 85.015 88.445 84.860
LCQ9 106.190 111.360 112.415
KCU9 100.85 100.25 108.75
CCU9 2433 2369 2326
CTZ9 66.96 71.11 73.42
SBV9 12.41 12.75 13.00
JOU9 103.70 111.45 123.60
HGU9 269.90 280.95 278.90
Have a good day,
Mike