Happy Birthday Sir Isaac! Yes, Isaac Newton was born 371 years ago on December 25, but since I will be out of the office this week I thought I would send my greetings early, and commemorate his birthday with a look at the trends of some key market. Remember, it is Newton's First Law of Motion, applied to markets, that laid the groundwork for technical analysis to begin with. "A trending market will stay in that trend until acted upon by an outside force".
As the accompanying table shows, there has been some change in trend in a number of the markets. Each of them also have a key point that we need to keep an eye on in the days (minor, short-term), weeks (secondary, intermediate-term), and months (major, long-term) ahead.
Corn: The nearby contract is in the process of establishing a bullish key reversal on its monthly chart. The March contract needs to move above the November high of $4.38 this month and post a higher monthly close ($4.15 1/4).
Soybeans: Weekly stochastics for both the nearby January and more actively traded March contracts are nearing the overbought level of 80%, possibly triggering increased selling.
Wheat: Contracts of all three wheat markets (Chicago, Kansas City, and Minneapolis) are sharply oversold, with stochastics (daily, weekly, and monthly) in single digits.
Crude oil: The minor (short-term) trend could be nearing a downturn if a bearish crossover, above 80%, is established by the spot-month contract.
Distillates (heating oil): The spot-month contract continues to run into solid minor (short-term) and secondary (intermediate-term) resistance at the previous high of $3.0869.
Natural gas: The strong uptrend in the market has left it in an overbought situation with stochastics near or above the 80% level.
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