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December wheat (WZ1 | Quote | Chart | News | PowerRating) is sliding in one of its biggest down days in months, dragging corn and the bean complex down with it. Still, wheat's expansion bar from 11/16, gives the contract an upside slant. Today's steep down move, which came in the opening five minutes when stops were hit below the low of the post-11/16 consolidation, will need to close below 274 to remove the positive tilt in wheat.
The situation in January soybeans (SF2 | Quote | Chart | News | PowerRating) is less encouraging as today's down stroke took out the past 10 days' closes and represents an outside day down that never closed (closed above) the gap left from 10/12. The situation in corn (CZ1 | Quote | Chart | News | PowerRating) is similar to beans.
March cocoa (CCH2 | Quote | Chart | News | PowerRating), the leader on the Momentum-5 List, lapped open and successfully tested the opening to make good on an Off The Blocks long entry and trade to a new contract high.
As pointed out in the Pre-Opening Energy Futures Outlook for natural gas (NGZ1 | Quote | Chart | News | PowerRating) "US temperatures were simply bearish over the weekend and are basically projected to be above normal in the near future." Still, entry was not available on the contract's Pullback From Lows setup because of the lap-down opening. Natgas is rallying off lows, but 2.745 -- an area that coincides with multiple intraday retracement ratios and a retest of the Pullback From Lows Breakdown trigger -- would be an area to test the theory of additional downside in nat gas.
In a day of light economic news, traders eyed a report from the National Bureau of Economic Research that said the US was in a recession. Although the market has widely expected such a proclamation and economic result, there has been about a one-point pop on the statement from the institute, considered the leading authority on such matters. The traditional measure of recession has been "two quarters of zero or negative economic GDP growth." The National Bureau of Economic Research's is broader, defining a recession as "a significant decline in activity spread across the economy, lasting more than a few months, visible in industrial productions, employment, real income and wholesale-retail trade. A recession begins just after the economy reaches a peak of output and employment, and ends as the economy reaches its trough."
The "recession" halts a decade-long economic expansion, the longest in US history. T-bonds (USZ1 | Quote | Chart | News | PowerRating) are paring earlier gains, and are up 18/32 at 104 11/32.
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