Halloween has arrived early! Okay, not really. But for those who knock on the door of the brand-new October Monthly Futures Junctures (published October 22), the treats of opportunity in the world’s leading commodity markets will be sweet indeed.
First into the bag: Monthly Futures Junctures’ “Featured Market”segment. Here, Elliott Wave International’s chief commodity expert Jeffrey Kennedy sheds ample light on three markets whose names now conjure images of a global food crisis: Rice, oats, and milk. With six historic price charts and three pages of objective commentary, Jeffrey separates Fear from Facts to reveal which foods could be forming imminent tops and which ones could be thrusting to new price extremes.
Staying Cocoa's Course: All through the hullabaloo surrounding the cocoa market (SEE: London hedge fund manager buys up entire stock of Europe's cocoa) Jeffrey Kennedy has stayed objective to the market's near-term swings. (SEE: archive of Jeffrey's cocoa analysis below):
- December 2009 MFJ: With prices at a 30-year peak, "It's time to prepare for a trend change. Cocoa's price chart is a flashing strobe light. With five waves up and done, expectations call for a selloff to near 3000."
Prices fulfilled this script to a "T," and then some.
- April 20, 2010 Daily Future Junctures: "I anticipate a time consuming corrective advance that will ultimately push prices into Fibonacci resistance at 3143-3231. Once this area is achieved, we'll look for the resumption of the downtrend."
Cocoa prices rallied to the cited target area and once again, turned down to a nine-month low before pausing in June.
- July 2010 Monthly Futures Junctures, "This pattern alone argues that cocoa has registered a top... and certainly argues that a massive buying effort at this time is ill conceived."
Cocoa soon recommitted to the downside, plungint to a one-plus year low in early September.
- September 16, 2010 Daily Futures Junctures: "The manner and extent of the recent move up argues that the decline is complete."
Now, the October publication reveals where and when the run-up may end.
Coffee: Hot Coffee: The June 2010 MFJ "Feature" highlighted coffee for the first time in a year-and-a-half. Opportunity was hot. Jeffrey saw "technical evidence supportive of additional gains in the weeks ahead." Soon after, coffee continued to rise, soaring smoothly to the new contract highs we see today.
Sugar: As prices approached a 30-year peak early this year and mass hysteria of "Peak Sugar" broke out -- the January 25 Daily Futures Junctures hit this sour note: "The upcoming market top should set the stage for a large and time consuming fall." From there, prices plummeted 50%-plus to a one-year low before pausing in June. Then, after months of sideways action, the September 13 DFJ wrote: "I now believe odds favor further strength into at least November." With November just around the corner, has Jeffrey's time table changed?
Cotton: The January 2010 MFJ "Wave Watch" presented an exciting picture that showed prices nearing the end of wave (4) down. Once complete, wave (5) was set to introduce a powerful rally to new contract highs. In short order, cotton stole the show with prices soaring to a new all-time high. Now, the October MFJ spins the long-term yarn.