Bespoke's Commodity Snapshot (7/23/08)

Below we highlight our trading range charts of ten major commodities.  The green shading represents two standard deviations above and below the commodity's 50-day moving average.  When the price moves above/below the green shading, it is considered overbought/oversold. 

Even after a $20+ decline in oil, the commodity still isn't oversold.  This shows how strong the uptrend in oil was leading up to the recent declines.  But now that the uptrend is broken, it looks like oversold territory could be reached soon.  Natural gas is oversold, however, after declining more than 25% from its peak on July 3rd.  It also broke its uptrend, and the technical damage done in recent days is nothing to laugh at.

Gold and silver have actually held up well as other commodities have been falling.  Interestingly, platinum has diverged from gold and silver on the downside and is trading well into oversold territory.  And after peaking on June 26th, corn has now fallen 27% as well.  US consumers are definitely welcoming these declines.

click to enlarge

Comments

[paultaut]

What declines? Producers are still playing catch up to last year's increases.

only one of the above charts is lower year over year, the wheat contract only provides 7 months of activity.