Commercials unwind their net-long position in Lean Hogs, dropping almost 24,000 contracts over the trailing four weeks.Commercial hedgers remain near three-year extremes after hitting a record-long position in Palladium.The commodity supercycle will be no re-run. Remember, the volatility in these markets is not for the faint of heart. Perhaps I’ll cover livestock hogs have my full attention right now. I outlined well-defined risk levels in Chicago wheat on Wednesday.Īnd I’ll go deeper into corn, the wheat and soybean complexes, and even oats next week. I’m buying the December contract if and when it breaks above Wednesday’s high at approximately 630, eyeing a move back to 675.Ĭorn futures could run it back to eight bucks – or even higher. Regardless, when grain markets start moving, it’s a fast and furious affair to the finish line. (Also, note the breakaway gap on June 12.)īut corn has reached a logical level to digest its recent gains, falling 36 cents during today’s session.Ī pullback in price could take a few days or a few weeks. The 14-day RSI is breaking out of a bearish regime, posting a bullish momentum thrust.Įxplosive moves such as this tend to kick off sustained rallies. The December corn contract has climbed more than a dollar over the past four weeks.įor the uninitiated, that’s a huge move that might have legs.
More precisely, that’s how the supply and demand dynamic unfolds for raw materials: escalator up! elevator down! and repeat… As we all know, price doesn’t move in a straight line.Ĭommodity rallies challenge that notion over shorter time frames yet give the impression of a yo-yo when zooming out on the charts. I expect many such interruptions during the cycle. Let’s call the recent correction a “commercial interruption.”
Yes, the correction favoring stocks off the 2022 lows has been significant.īut it’s retreating from a logical confluence of potential resistance – a multi-year downtrend line and a key retracement level. It’s been commodities over stocks since crude traded below zero in the spring of 2020. Here’s the S&P 500 versus the CRB Index, a simple stocks/commodities ratio: That doesn’t mean we should plug in, turn on and cop out.
Nor will jeera futures have their turn in the limelight. Hollywood will not make a movie on crude oil trading below zero. Jim Cramer will not provide commentary on cotton, cattle, and/or the crack spread. From the Desk of Ian Culley commodity supercycle will not be televised.
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