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Strategies & Market Trends : John Pitera's Market Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: nspolar who wrote (9858)	8/21/2008 7:13:31 PM
From: John Pitera	Read Replies (2) \| Respond to of 33421

TF, Yes we are getting a rally in commodities, currencies and the energy complex. Crude did work it's way down to the $111 level which I had indicated was possible a few weeks ago. Natural Gas fell viciously below the 8.95 level and had an extra buck to fall while setting up a couple of daily price momentum buy divergences. Crude @ 111.50 had made a .382 retracement of the move from 51.07 low in January of 2007 to the early july high of 147.90 houstonenergyperspectives.netfirms.com That was a longer term Fibonacci retracement as well as the 200 day simple moving average at 110.90 and the 200 day exponetial ma @ 112. Let's see how the best weekly bounce in commodities in 33 years conducts itself from here. As we have been saying for the past few months these are EXTREMELY and EXCEPTIONALLY VOLATILE times for so many of the major global capital markets. When every single commodities in the CRB except Live Hogs advances on the same day it shows how the markets are sloshing around frenetically, engaging in price discovery and trying to discern, the massive contradictory inflationary and deflationary forces in the global Macro economic system. stay tuned..... John ------------------------------- Commodities Rally, Heading for Biggest Weekly Jump Since 1975 By Millie Munshi Aug. 21 (Bloomberg) -- Commodities headed for their biggest weekly gain in 33 years as oil rose for a third day and a weakening dollar revived demand for raw materials as alternative assets. The Reuters/Jefferies CRB Index of 19 commodities soared 3.7 percent to 405.92 in New York. A settlement tomorrow at that level would mark a 6.2 percent gain for the week, the most since July 1975. The dollar dropped the most against the euro since June today and oil jumped more than $5 a barrel. The rebound in the CRB and a resumption of the dollar's decline may stall a rout in commodities that has sent the index down 14 percent from a record on July 3. Raw materials priced mostly in dollars often move in the opposite direction of the U.S. currency. ``The bounce in the dollar had caused people to sell commodities aggressively, and a lot of that selling became overdone,'' said Chip Hanlon, who helps manage $1.5 billion at Delta Global Advisors in Huntington Beach, California. ``This move may tell us that those downtrends are over. Commodities could continue to rally from here.'' Every commodity on the CRB except hog futures moved higher today. Nickel jumped 8 percent, cocoa rose 6.8 percent and silver rallied 5.2 percent. Oil and gold had their biggest one- day advances since June. Platinum jumped 6.6 percent, the most since September 2001. Chinese Demand Commodities also gained today on speculation demand will increase from China as the country resumes work at factories and infrastructure projects that were shut or slowed during the Olympics, which end Aug. 24. ``China's demand is very important to the commodity markets,'' Hanlon said. ``Now that they're ready to start bringing back factories that had been idled, I wouldn't be surprised to see demand start to pick up again there. Their long-term outlook for growth and development hasn't changed.'' The CRB has more than doubled since 2001 as demand surged in China, the world's fastest-growing major economy. Mining and oil companies, farmers and other commodity producers have struggled to keep up with rising consumption as harsh weather and labor unrest disrupted supplies. ``Until either a lot of supply comes on stream or the economy collapses, the bull market will continue,'' said investor Jim Rogers, who in April 2006 correctly predicted oil would reach $100 a barrel and gold $1,100 an ounce. Top Gainers Today's gains in the CRB were led by nickel futures that rose to their highest price since July 11. Cocoa rose the most since November 2004 in New York. The International Cocoa Organization said a global deficit will be twice as large as previously expected, with output trailing demand by 88,000 metric tons in the year through September, up from an earlier forecast of 41,000 tons. ``That news, along with dollar weakness, powered strong early-morning gains,'' Dan Vaught, an analyst for Wachovia Securities LLC in St. Louis, said today in a report. The UBS-Bloomberg Constant Maturity Commodity Index rose 4 percent to 1,509.546 at 4:45 p.m. A settlement at that price tomorrow would mark a 6.9 percent gain this week, the most since the data starts in 1997. To contact the reporter on this story: Millie Munshi in New York at mmunshi@bloomberg.net Last Updated: August 21, 2008 17:10 EDT