Weekly Commodities Report - Nat Gas approaching key support; WTI recovers
COCOA - The downtrend remains strong, but it managed to break above a key trendline resistance from the Mid-November high today. Although it failed to close the day above it, a clear break would pave the way for a move towards $2450/60 resistance. The daily chart is also showing bullish RSI divergence, suggesting that we could see a recovery in Cocoa prices. Traders looking to go with the overall trend and establish a short position, should keep an eye on the area around $2600, where heavy resistance is noted.
COFFEE is also showing signs of a recovery, following a decent bounce ahead of $130 support and bullish RSI divergence on the daily chart as well. Immediate resistance is seen at $145, and a break above would signal a move to at least $157.
COPPER continues to consolidate and volatility has decreased noticeably. It is currently trading within an ascending channel, but failed at $2.56 resistance. Key support lies now at $2.45, but the most significant area is $2.28-2.32, and Copper is likely to attract plenty of demand should we see that one tested. To the topside, a break above $2.56 would pave the way for a move back towards $2.75, where gains were capped in mid-November.
GOLD is looking increasingly bullish. It broke above $1150 resistance earlier this week, and ran into decent demand on the retest that followed. Resistance is now seen at $1180, but the major obstacle for Gold remains $1200.
NAT GAS is trading near a key support level at $3.23. While techs remain bullish overall, a break below would signal a deeper retracement, to at least $2.85. The next significant support level would then lie at $2.54, which is the August & November '16 low. The commodity has come under sharp pressure in the past few trading days, and given the strong rejection off $3.90 resistance + a break sub-$3.23 looking imminent, further losses seem likely.
SOYBEAN has been consolidating in a rather tight range in the past few trading weeks and the short-term technical outlook remains mixed. It would require a clear break above $1065 resistance for momentum to accelerate, while to the downside, key support lies at $974. A break below the aforementioned level would likely trigger a move back towards the late September low at $933.
WTI had a sharp rejection off $55.15 resistance yesterday and declined to $52.10. However, it has seen a decent bounce off this key support level and managed to recover back above $53 today. The technical outlook remains bullish overall, and it is likely that we will see another test of $55.15 soon. The RSI on the daily chart is not showing overbought conditions yet, and momentum continues to be strong overall.
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