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Weekly Market Watch
The Future is in Futures
by Pearce Financial, LLC
March 7 - March 11, 2004

Based on last week's trading activity & reports,
the following markets are setting up for potential trading opportunities. 

Stock indices - The March S&P 500 finds near term resistance at last week's three and a half year high of 1225.50. Further resistance is at the major monthly Fibonacci .618 retracement at 1265.90. After that the market could visit the psychological 1300 area. Near term support is at last week's low of 1198.50 (the S&P 500 has made higher weekly lows for four out of the last five weeks) and the 18-day Moving Average that it has only closed below twice in the last month. A drop below this near term support could cause a quick decline to the current intermediate daily Fibonacci .618 retracement at 1187.80 or the February low of 1181.30. A break below last month's could send the S&P 500 to the January low of 1164.50 in confluence with the major daily Fibonacci .382 retracement at 1163.20. If the market does not stabilize here it could easily challenge the monthly 18-bar Moving Average at 1134.30 or the major daily Fibonacci .618 retracement at 1124.70. Open Interest is picking up slightly. The %R overbought/oversold indicator shows that the S&P 500 is overbought on the daily, weekly, and monthly charts. Seasonally, the S&P 500 should gain strength in March.  Commercials are holding the smallest net short position since mid-November. Large traders (hedge funds) are still holding the biggest net short position since mid-August. Small traders are the least bullish in two and a half months.

The March NASDAQ 100 find near term support clustered between the February low of 1491.00, the January low of 1484.00, and the monthly 18-bar Moving Average at 1475.50. (The NASDAQ 100 has not closed below the monthly 18-bar Moving Average for two years). Further support is at the major daily Fibonacci .618 retracement at 1441.40. A break below it could take the NASDAQ 100 to the major weekly Fibonacci .382 retracement at 1318.80 or even last year's low of 1302.00. Near term resistance is at the February high of 1565.00. Further resistance is at the daily Fibonacci .618 retracement at 1583.50. If the rally does not end here the March NASDAQ 100 could challenge the contract high of 1645.00. A break out to new contract highs could send the market to the December 2001 high of 1738.00. Open Interest is at a two and a half month high. The NASDAQ 100 should be in a choppy trading range in March.  Commercial interests are holding the biggest net short position in nearly seventeen months. Large traders increased the size of their biggest net short position in almost a year. Small traders increased the size of their record size net long position again.

Interest rates - March T-bonds near term support at last week's two month low of 111-04 . Further support is at the daily contract low of 108-16 in confluence with the major weekly Fibonacci .618 retracement at 108-17. Near term resistance is found between the current daily Fibonacci .382 retracement at 113-08 and last week's high of 113-15. (T-bonds have made lower weekly lows and lower weekly highs for three consecutive weeks). If the market makes it past this mark it should go to the current daily Fibonacci .618 retracement at 114-17. Further resistance is at the contract high of 116-21. A break out to new highs could allow June T-bonds to test the weekly February high of 117-12 or last year's weekly high of 117-26. The June NOB spread (T-notes vs. T-bonds) finds near term support at the psychological level of 2-00 premium T-bonds. Further support is the psychological level of 1-00 premium T-bonds. If the decline does not stop here expect the spread to hit even money. Near term resistance is at the all-time high of 4-02 premium T-bonds. Further resistance is at the psychological 5-00 mark. Open Interest is still near the record high. The %R overbought/oversold indicator shows that T-bonds briefly hit oversold on the daily chart. T-bonds have a seasonal tendency to decline in March.   Commercial interests more than doubled the size of their net long position from the previous week to become the most bullish since July. Large traders are holding the largest net short position since July. Small traders are bearish as well.

March T-notes find near term support clustered between last week's multi-month low of 109-12, the major daily Fibonacci .382 retracement at 109-07, and the intermediate weekly Fibonacci .786 retracement at 109-065. If the market does not stabilize here look for a decline to the major daily Fibonacci .618 retracement at 107-065. Near term resistance is found at last week's high of 110-18 (T-notes have made lower weekly lows and lower weekly highs for three consecutive weeks) in confluence with the current daily Fibonacci .382 retracement at 110-185. If the market makes it past this mark it should go to the current daily Fibonacci .618 retracement at 111-10. A rally above it could take June T-notes to the contract high of 112-16. A break out to new highs should send this market up to the weekly February high of 113-125. Open Interest pulled back slightly from the all-time high. The %R overbought/oversold indicator shows that T-notes briefly reached oversold territory on the daily chart. T-notes have a seasonal tendency to drop sharply in March.  Commercials nearly doubled the size of their net long position from the previous week to become the most bullish since July. Large traders (hedge funds) are neutral. Small traders increased the size of their record net short position again.

International bonds - March Canadian 10-year bonds find near term support at last week's one and a half month low of 111.26. A break below it could slam the market to further support at the January low near 110.94. Near term resistance is found at last week's high of 112.22. (Canadian bonds have made lower weekly highs for three consecutive weeks). A rally above it could allow the market to test the current major daily Fibonacci .618 retracement at 112.32. Further resistance is at the contract high of 112.97. A break out to new highs could send the market up to the weekly February high of 113.78.  March Euro bunds find near term support at last week's three month low of 116.98. Further support is at the major weekly Fibonacci .618 retracement at 115.95. Near term resistance is at last week's high of 117.94. (Euro bunds have made lower weekly highs for three consecutive weeks). A rally above it could allow the market to test the current major daily Fibonacci .618 retracement at 118.86. If June Euro bunds do not stop here expect them to challenge the contract high of 120.02. Further resistance is at the all-time high of 120.98.  March London long gilts find near term support between last week's low of 108.68 and the October low of 108.60. A drop below it should take the market right to the major weekly Fibonacci .618 retracement at 107.80. Near term resistance is at last week's high of 109.75. (Gilts have made lower weekly highs for three consecutive weeks). A rally above it could allow the market to test the current major daily Fibonacci .618 retracement at 110.81. Further resistance is at the contract high of 112.12.  March Australian 10-year bonds find near term support at last week's new contract low of 94.335. Further support is at the major weekly Fibonacci .618 retracement at 94.25. Near term resistance is at last week's high of 94.475. (March Aussie bonds have only exceeded a previous week's high once in the last seven weeks). A rally above it could allow the market to run back up the current major daily Fibonacci .618 retracement at 94.67. If the rally does not end here the market may be headed up to the contract high of 94.875 in confluence with the weekly 2004 high at 94.89.  March JGB's  (Japanese gov't. bonds) find near term support at last week's three month low of 137.75. Further support is at the major weekly Fibonacci .382 retracement at 137.36. Near term resistance is at last week's high of 138.55. (JGB's have made lower weekly lows and lower weekly highs for three out of the last four weeks). Further resistance is at the current major daily Fibonacci .618 retracement at 139.12. If the rally does not stop here JGB's could challenge the contract high of 139.96. Further resistance is at the weekly 2004 high near 140.50.

Currencies - The US dollar index finds near term support clustered between the major daily Fibonacci .618 retracement at 82.38, last week's one and a half month low of 82.28, and the January 12th reaction low of 82.05. Further support is at another technical support zone between the contract low of 80.48 and the 1995 low of 80.14. Near term resistance is located between last week's high of 83.40 and the current intermediate daily Fibonacci .382 retracement at 83.49. A rally above it could allow the market to test the current intermediate daily Fibonacci .618 retracement at 84.25. Further resistance is at the major daily Fibonacci .382 retracement at 85.40 in confluence with the current February high of 85.46. If the rally does not end here look for a run to the monthly 18-bar Moving Average at 86.96. (the US dollar index has not closed above the monthly 18-bar Moving Average in nearly three years). Further resistance is at the intermediate weekly Fibonacci .618 retracement at 87.91 (as measured between last year's weekly high of 92.50 and last year's weekly low of 80.48). Open Interest is at a two month high. The %R overbought/oversold indicator shows that the greenback is oversold on the daily and monthly charts. The Seasonal index shows that the dollar should move sharply higher in March.  Commercial interests increased their net long position last week. Large traders increased the size of their small net short position. Small traders are neutral.

The March Canadian dollar finds near term resistance at the major daily Fibonacci .382 retracement at .8167 in confluence with the February high of .8172. (The Canadian dollar has made lower monthly highs for three consecutive months). Further resistance is at the daily Fibonacci .618 retracement at .8304. After that the "looney" could quickly test the January high of .8370. Near term support is at the February low of .7945. A break below it could cause the "looney" to dive to the major daily Fibonacci .618 retracement at .7656. Open Interest is at the highest level since mid-December. Seasonally, the Canadian dollar has a tendency to move sideways in March.  Commercial interests are the least bearish since the end of June. Large traders are the most bearish since then. Small traders are still neutral.

The March Australian dollar finds near term resistance between the contract high of .7945 and the weekly 2004 high of .7980. A strong break out above 80 cents could cause a price surge to the 1996 high of .8210. Near term support is at last week's low of .7763 and the 18-day Moving Average that it has closed below only once in nearly two months. A break below this near term support could elect liquidation sell stops and take it down to the current intermediate daily Fibonacci .618 retracement at .7601 in confluence with last month's low of .7591. (The Aussie dollar has only broken a previous monthly low once in the last eight months). A clean break below 76 cents could knock the Aussie to the current major daily Fibonacci .382 retracement at .7493. Open Interest is at a new all-time high. The %R overbought/oversold indicator shows that the Aussie is overbought on the daily, weekly, and monthly charts.  Commercials increased the size of their record net short position again. Large traders (hedge funds) increased the size of their record net long position again. Small traders also increased the size of their record net long position.

The March Canadian dollar/Australian dollar spread finds near term support at last week's new multi-month low of .0194 (about two cents) premium Canadian dollar. Further support is at the major weekly Fibonacci .618 retracement at .0148 (about one and a half cents). Near term resistance is at the current major daily Fibonacci .382 retracement at .0496 (about five cents) premium Canadian dollar. Further resistance is found at the January high of .0694 (about seven cents) premium Canadian dollar in confluence with the current major daily Fibonacci .618 retracement at .0683 (about seven cents) premium Canadian dollar. If the rally does not end here the spread could make it to the current major daily Fibonacci .786 retracement at .0816 (just over eight cents) premium Canadian dollar or even the November high of .0878 (about eight and three-quarter cents) premium Canadian dollar.

The March British pound finds near term resistance at last week's two month high of 1.9264. Further resistance is at the contract high of 1.9446 or the weekly December high of 1.9500. Near term support is at last week's low of 1.9021. (Sterling has made higher weekly highs and higher weekly lows for three consecutive weeks). A drop below it could allow the market to test the current daily Fibonacci .618 retracement at 1.8765. Further support is at the February low of 1.8456. If this low is broken sterling could plunge to the monthly 18-bar Moving Average at 1.8270. (Sterling has not closed below the monthly 18-bar Moving Average since the summer of 2002). Open Interest is at a two and a half month high. The %R overbought/oversold indicator shows that sterling is overbought on the daily and monthly charts. The pound has a seasonal tendency to drop in the first week of March and then move sideways for the rest of the month.  Commercials continued to aggressively increase the size of their big net short position. Large traders (hedge funds) increased the size of their net long position. Small traders are neutral to bullish.

The March Swiss franc spent several trading days hanging around the major daily Fibonacci .618 retracement. A rally above the February high of .8647 should immediately send the market to the major daily Fibonacci .786 retracement at .8737. Further resistance is at the double top contract high of .8892. Near term support is found between last week's low of .8437. A drop below it could the current daily Fibonacci .618 retracement at .8352. Further support is located between the February low of .8169 and the major daily Fibonacci .618 retracement at .8131. A break below this price zone could take the Swissie to the psychological 80 cent mark. Open Interest is flat. The %R overbought/oversold indicator shows that the Swissie is overbought on the monthly chart. The Seasonal index shows that the Swiss franc usually declines in March. Commercial interests are neutral on the Swissie right now. Large traders are neutral. Small traders are neutral as well.

The March Euro currency finds near term resistance clustered between last week's one and a half month high of 1.3282, the January 12th reaction high of 1.3303, and the major daily Fibonacci .618 retracement at 1.3323. If the market can take out this resistance zone look for a run to the major daily Fibonacci .786 retracement at 1.3483. Near term support is located between last week's low of 1.3087 (the Euro has made higher weekly highs and higher weekly lows for three consecutive weeks) and the current daily Fibonacci .382 retracement at 1.3073. A drop below it could allow the market to return to the current daily Fibonacci .618 retracement at 1.2944. Further support is clustered at the February 7th, 8th, 9th, and 10th lows of 1.2735, 1.2738, 1.2743, and 1.2742. A break below this support zone could hammer the Euro to the monthly 18-bar Moving Average at 1.2520 (the Euro has not closed below the monthly 18-bar Moving Average for three years) in confluence with the major daily Fibonacci .618 retracement at 1.2490. Open Interest is flat. The %R overbought/oversold indicator shows that the Euro is overbought on the daily and monthly charts. Seasonally, the Euro should rally in the first week of March and then drop substantially for the rest of the month.

The March Japanese yen finds near term resistance between the February 22nd reaction high of .009644 and the major daily Fibonacci .618 retracement at .009690. Further resistance is at the January high of .009864 or the contract high of .009885. A break out to new contract highs could launch the market to the 2000 weekly high of .009974 in confluence with the late 1999 high of .009990. Near term support is at last week's low of .009472. A drop below it could send the market to the February low of .009375. Further support is at the major daily Fibonacci .618 retracement at .009254. After this level the yen may not find support again until the psychological .009000 mark. Open Interest is flat. The yen has a seasonal tendency to rally in the first week of March and then decline for the rest of the month.  Commercial interests are turning neutral again. Large traders are neutral on the yen. Small traders are the neutral to bullish.

Metals - April gold made an outside reversal down on the weekly chart last week when it took out the previous week's high and then reversed and took out the previous week's low. This is bearish price action. A break below last week's low of $430.10 could cause an quick decline to the current intermediate daily Fibonacci .618 retracement at $422.10. Further support is clustered between the monthly 18-bar Moving Average at $412.80 (gold has not closed below the monthly 18-bar Moving Average since July of 2001), the February low of $411.50, and the major daily Fibonacci .618 retracement at $410.70. If gold does not stabilize in this area it could get crushed to the major monthly Fibonacci .382 retracement at $378.30 or even last year's monthly low of $372.00. Near term resistance is found between last week's two month high of $439.30 and the major daily Fibonacci .618 retracement at $441.70. Further resistance is at the late December high of $449.00 in confluence with the major daily Fibonacci .786 retracement at $449.90. Open Interest is at a two month high. The %R overbought/oversold indicator shows that gold is overbought on the daily chart. The Seasonal index shows that gold should decline sharply until the end of March.  Commercials are starting to increase the size of their net short position again. Large traders (hedge funds) are increasing the size of their net long position. Small traders are neutral.

May silver finds near term support between last week's low of $7.18, the 18-day Moving Average that it has not closed below for about a month, and the current major daily Fibonacci .382 retracement at $7.15. If the market does not stabilize here it could quickly decline to the current major daily Fibonacci .618 retracement at $6.865. Further support is at the February low of $6.52 in confluence with the monthly 18-bar Moving Average at $6.595. (Silver has not closed below the monthly 18-bar Moving Average since June 2003). A break below this support zone could slam silver to the intermediate weekly Fibonacci .786 retracement at $6.085 in confluence with the weekly September low of $6.065. Near term resistance is at the February high of $7.61. A rally above it could send the market running up to the daily Fibonacci .786 retracement at $7.88. Further resistance is at the contract high of $8.28. Open Interest is flat. The %R overbought/oversold indicator shows that silver is near overbought on the daily chart. Seasonally, silver should decline sharply until early April. Commercials are neutral. Large traders (hedge funds) are neutral. Small traders are neutral.

May copper finds near term resistance at last week's new contract high 150.70. Further resistance is at last year's weekly high of 155.00. A rally above it could take May copper up to the 1988 multi-decade high of 160.65. Near term support is at last week's low of 145.00 (copper has only broken a previous week's low once in the last eight weeks) and the 18-day Moving Average that it has not closed below for about a month. A drop below it could initiate a sell off to the current intermediate daily Fibonacci .382 retracement at 137.80. Further support is found between the current intermediate daily Fibonacci .618 retracement at 129.85 and the January low of 129.50. Open Interest is at a new all-time high again. The %R overbought/oversold indicator shows that copper is overbought on the daily and monthly charts. Copper has a seasonal tendency to move higher in March and establish an important seasonal high at the end of the month.  Commercials are holding the largest net short position in thirteen months. Large traders (hedge funds) are holding the largest net long position since November 2003. Small traders remain neutral.

Energies - April crude oil finds near term resistance at last week's new contract high of $55.20. Further resistance is at last year's all-time high of $55.65. If this high is exceeded crude oil could quickly hit the psychological $60 mark. Near term support is at last week's low of $50.65 (crude oil has made higher weekly highs and higher weekly lows for three consecutive weeks) and the 18-day Moving Average that it has not closed below for about a month. A break below this near term support could take it down to the current major daily Fibonacci .618 retracement at $46.55. A break below it could send the market down to the daily December low of $41.20. Open Interest is at a new all-time high again. The %R overbought/oversold indicator shows that crude oil is overbought on the daily and monthly charts. The Seasonal index shows that crude oil should move slightly higher in March.  Commercial interests are aggressively increasing the size of their net biggest short position since Memorial Day. Large traders continued to increase the size of their net long position to become the most bullish since Memorial Day. Small traders are the least bearish in five and a half months.

April Unleaded Gas finds near term resistance at last week's new all-time high of 154.50. Further resistance is at the psychological 160 mark. Near term daily support is found between last week's low of 136.50. Further support is at the current major daily Fibonacci .618 retracement at 131.52. A break below it could cause a gasoline spill to the monthly February low of 120.50 or the monthly 18-bar Moving Average at 117.45. (Unleaded gasoline has not closed below the monthly 18-bar Moving Average for about two years). Open Interest reached a new all-time high. The %R overbought/oversold indicator shows that gasoline is overbought on the daily, weekly, and monthly charts. Seasonally, gasoline should rally sharply in March.  Commercials interests are holding the biggest net short position since May. Large traders are holding the biggest net long position since then. Small traders are neutral.

April natural gas finds near term resistance at the February high of 6.800. Further resistance is at the major daily Fibonacci .618 retracement at 6.952. If the rally does not end here look for a run to the late November reaction high of 7.250 in confluence with the major daily Fibonacci .786 retracement at 7.290. Near term support is at the current major daily Fibonacci .382 retracement at 6.384. Bigger support is at the February low of 5.950 in confluence with the current major daily Fibonacci .786 retracement at 5.943. Further support is at the contract low of 5.710. A break to new contract lows could send natural gas down to the psychological 5.00 mark. Open Interest is at a two year high. The %R overbought/oversold indicator shows that natural gas is overbought on the daily chart. Natural gas has a seasonal tendency to decline until mid-March and then rally sharply in the second half of the month.  Commercial interests are holding the biggest net short position in nearly three months. Large traders are the least bearish in since mid-November. Small traders are holding a new record size net long position.

Meats - April live cattle finds near term resistance at last week's high of 89.70. Further resistance is at the contract high of 90.30. If April cattle hits a new contract high it could go right on up to the weekly January high of 92.75 in confluence with the weekly December high at 92.95. Near term support is at the February low of 85.30. Further support is at the December low of 83.45. After that April live cattle does not find technical support until the November low of 82.00. Open Interest is at a two month low. The %R overbought/oversold indicator shows that cattle is nearing overbought on the daily chart. The Seasonal index shows that cattle should trade in a choppy range in March.  Commercials are neutral. Large traders (hedge funds) are neutral to bullish. Small traders are still holding the biggest net short position in over four years.

May feeders finds near term resistance at last week's four month high of 101.00. Further resistance is at the major daily Fibonacci .786 retracement at 102.05. If this high is exceeded look for the market to test the contract high of 104.20. Near term support is at the February low of 96.02. Further support is at the contract low of 94.15. Open Interest is at a five year high. The %R overbought/oversold indicator shows that feeders are nearing overbought on the daily chart. Seasonally, feeders should move sharply lower in March.  Commercial interests are holding a large net long position. Large traders are holding the biggest net long position since late June. Small traders increased the size of their biggest net short position since October of 2003.

April lean hogs finds near term resistance at last week's one and a half month high of 76.60. Further resistance is at the contract high of 78.60. A break out to new contract highs could send April hogs right to the 2004 weekly high of 82.70. Near term support is at last week's low of 73.92. (Hogs have made higher weekly highs and higher weekly lows for three consecutive weeks). Further support is at the February low of 71.65. If last month's low is broken April hogs could drop to the major daily Fibonacci .382 retracement at 68.97 in confluence with the December low of 68.70. Open Interest is near the all-time high. The %R overbought/oversold indicator shows that hogs are near overbought on the monthly chart. Hogs have a seasonal tendency to rally thru most of March and then drop sharply in the last week of the month.  Commercials are bullish on hogs. Large traders (hedge funds) are neutral. Small traders are still holding a very large short position.

Grains - May soybeans finds near term resistance at last week's six month high of $6.35. Further resistance is at the September high of $6.58 followed by the major daily Fibonacci .618 retracement at $6.71. Near term support is at last week's low of $6.11 (beans have made higher weekly highs and higher weekly lows for the last four weeks) and the 18-day Moving Average that it has not closed below for about a month. A break below this near term support could take it down to the current major daily Fibonacci .618 retracement at $5.522. If the market does not stabilize here it may test the contract low of $5.01. Open Interest is at the highest level since the harvest of 2003. The %R overbought/oversold indicator shows that beans are overbought on the daily chart. The Seasonal index shows that soybeans usually rally sharply in March.  Commercial interests sold about twenty percent of their position from the previous week but they are still holding a huge net long position. Large traders are holding the smallest net short position since July. Small traders are now holding a record net short position.

March soy meal finds near term resistance between last week's six month high of $190.80 and the September high of $194.00. Further resistance is at the major daily Fibonacci .618 retracement at $206.60. Near term support is at last week's low of $181.00 (meal has made higher weekly highs and higher weekly lows for three consecutive weeks) and the 18-day Moving Average that it has not closed below for about a month. A break below this near term support could trigger some serious liquidation orders and take it down to the current daily Fibonacci .618 retracement at $165.10. If the market does not stabilize here look for a decline to the contract low of $149.20 or the weekly 2002 low of $145.40. Open Interest is at a one and a half month low. The %R overbought/oversold indicator shows that meal is overbought on the daily chart. Seasonally, soy meal should move higher in March.  Commercials are holding the largest net short position since July. Large traders (hedge funds) are holding the largest net long position since then. Small traders are bullish.

May bean oil finds near term resistance at last week's nearly six month high of 23.54. A rally above it could allow the market to make a run for the major daily Fibonacci .618 retracement at 24.57. Further resistance is at the September high of 25.40. Near term support is at last week's low of 22.62 (bean oil has made higher weekly highs and higher weekly lows for the last four weeks) and the 18-day Moving Average that it has not closed below for about a month. A break below this near term support could cause a sharp decline to the current daily Fibonacci .618 retracement at 20.74. Further support is at the contract low of 19.01 or even the major weekly Fibonacci .786 retracement at 18.81. Open Interest reached a two month low. The %R overbought/oversold indicator shows that bean oil is overbought on the daily chart. Bean oil has a seasonal tendency to rally sharply in March. Commercial interests liquidated their net long position and are now holding the largest net short position since July. Large traders are now holding the largest net long position since then. Small traders are the most bullish since May.

May corn finds near term resistance clustered between last week's three and a half month and a half high of $2.25, the November high of $2.26, and the October high of $2.266. Further resistance is at the major daily Fibonacci .618 retracement at $2.364. Near term support is at last week's low of $2.16 (corn has made higher weekly highs and higher weekly lows for the last four weeks) and the 18-day Moving Average that it has not closed below for about a month. A break below it should send the market right down to the current daily Fibonacci .618 retracement at $2.106. Further support is at the contract low of $2.02. A break to new lows could encourage May corn to visit the 2002 weekly low of $1.914. Open Interest is at a one and a half month low. The %R overbought/oversold indicator shows that corn is nearing overbought on the daily chart. The Seasonal index shows that corn should move higher in March.  Commercials sold off a third of their net long position from the previous week and are now the least bullish in six months. Large traders (hedge funds) are now holding the largest net long position since July. Small traders are holding a record net short position.

May rice finds near term support at the contract low of 6.34. Further support is at the psychological 6.00 mark. Near term resistance is at last week's high of 6.89 followed by the current major daily Fibonacci .382 retracement at 6.98. Further resistance is at the current major daily Fibonacci .618 retracement at 7.375 followed by the January high of 7.51. Open Interest is at a one month low. The %R overbought/oversold indicator shows that rice is oversold on the weekly chart. Seasonally, rice should decline in March.  Commercial interests are neutral. Large traders (hedge funds) are neutral. Small traders are neutral to bullish.

May oats find near term support at the contract low of $1.464. Further support is at the major weekly Fibonacci .618 retracement at $1.412. After that oats could visit the weekly October low of $1.362. Near term resistance is at last week's high of $1.582. Further resistance is at the February high of $1.616. A break out above this high could send oats to this year's current weekly high of $1.73 or the weekly December high of $1.75. The %R overbought/oversold indicator shows that oats are overbought on the weekly chart. Open Interest is near a two month low. Oats have a seasonal tendency to move sideways in March.  Commercials are neutral to bearish on oats. Large traders (hedge funds) are neutral to bullish. Small traders remain neutral.

May wheat finds near term resistance at last week's five and a half month high of $3.464 in confluence with the major daily Fibonacci .618 retracement at $3.466. A rally above could allow the market to hit the September high of $3.554. Near term support is at last week's low of $3.33 (wheat has made higher weekly highs and higher weekly lows for the last four weeks) and the 18-day Moving Average that it has not closed below for about a month. A break below it should take wheat back down the current daily Fibonacci .618 retracement at $3.144. A break below it could allow the market to challenge the double bottom at the contract low of $2.95. If May wheat breaks down to new lows it could quickly drop to last year's weekly low of $2.824. Open Interest is at a six week low. The %R overbought/oversold indicator shows that wheat is near overbought on the daily chart. The Seasonal index shows that wheat should drop sharply in March.  Commercial interests dumped a lion's share of their net long position last week to become the least bullish since May. Large traders are now holding the largest net long position since May. Small traders are now holding the largest net short position since June.

Softs - May coffee finds near term resistance between the contract high of 126.60 and the weekly 2000 high of 126.00. A break out above this high should send coffee soaring to the 1999 high of 145.00 in confluence with the major monthly Fibonacci .382 retracement at 147.10. Near term support is at last week's low of 118.00 (coffee has made higher weekly lows for seven consecutive weeks) and the 18-day Moving Average that it has not closed below since mid-January. A break below this near term support could cause a coffee spill to the current major daily Fibonacci .382 retracement at 106.25 or the February low of 105.75. (Coffee has made higher monthly lows for six consecutive months). Further support is at the January low of 97.40. If the market does not stabilize here look for a further decline to the current major daily Fibonacci .618 retracement at 93.65. Open Interest is very high. The %R overbought/oversold indicator shows that coffee is overbought on the daily, weekly, and monthly charts. Seasonally, coffee should rally in the first week of March and then move sideways for the rest of the month.  Commercials are holding a record net short position. Large traders (hedge funds) are holding a record net long position. Small traders are neutral.

May cocoa finds near term resistance at last week's nearly four month high of $1,762. Further resistance is at the contract high of $1,808 or even last year's weekly high of $1,830. Near term support is found between last week's low of $1,665 (cocoa has made higher weekly lows for seven consecutive weeks), the 18-day Moving Average that it has closed above most of the time over the last month and a half, and the current daily Fibonacci .382 retracement at $1,651. Further support is at the current daily Fibonacci .618 retracement at $1,583. After that May cocoa could visit the February low of $1,540. Further support is at the January low of $1,472. Open Interest is at the highest level since November of 2000. The %R overbought/oversold indicator shows that cocoa is overbought on the daily chart. Cocoa has a seasonal tendency to rally sharply in March and establish an important seasonal high at the end of the month.  Commercial interests are holding the largest net short position since May of 1994. Large traders are holding a new record net long position. Small traders are holding the largest net long position since January of 2001.

May sugar finds near term support at last week's one and a half month low of 8.82. Further support is at the December low of 8.69 in confluence with the major daily Fibonacci .618 retracement at 8.67. Near term resistance is at last week's high of 9.25 (May sugar has made lower weekly highs for five consecutive weeks) in confluence with the current daily Fibonacci .618 retracement at 9.29. Further resistance is at the contract high of 9.58. After that the market could quickly hit the intermediate weekly Fibonacci .786 retracement at 10.02. A strong close above ten cents could catapult sugar to the 2000 high of 11.40 in confluence with the major monthly Fibonacci .618 retracement at 11.45. Open Interest is at a six week low. The %R overbought/oversold indicator shows that sugar is oversold on the daily chart. The Seasonal index shows that sugar should decline in March.  Commercials are still holding a record size net short position. Large traders (hedge funds) are holding a record size net long position. Small traders are also holding a record size net long position.

May orange juice finds near term resistance at last week's five month high of 94.95. Further resistance is at the contract high of 96 cents. A break out to new highs could send the market up to the psychological one dollar mark. Near term support is at last week's low of 87.80 (OJ has only broken a previous week's low once in the last eight weeks) and the 18-day Moving Average that it has closed above most of the time for the last month. A break below it could send OJ down to the February low of 82.30 in confluence with the current major daily Fibonacci .618 retracement at 82 cents or even the January low of 80.10. A break below this price level could send the market to the contract low of 74 cents. Open Interest is at the lowest level since September of 2003. The %R overbought/oversold indicator shows that OJ is overbought on the daily and weekly charts. Seasonally, OJ should rally sharply in March.  Commercial are the least bearish in nine months. Large traders are holding the smallest net long position since late June. Small traders are the least bullish since September of 2003.

May cotton tested the major daily Fibonacci .618 retracement. If it can take out last week's five month high of 51.65 it should go right on up to the major daily Fibonacci .786 retracement at 53.89. Further resistance is at the September high of 57.20. Near term support is at last week's low of 49.35 (cotton has only broken a previous week's low once in the last five weeks) and the 18-day Moving Average that it has not closed below for about a month. A break below it could cause the bull market to start unraveling and send cotton down to the current major daily Fibonacci .618 retracement at 45.51. Further support is located between the February low of 44 cents, the current major daily Fibonacci .786 retracement at 43.84, and the January low of 43.62. If May cotton does not find support at this level look for it to challenge the contract low of 41.71. Open Interest is at the highest level since October of 2003. The %R overbought/oversold indicator shows that cotton is nearing overbought on the daily chart. Cotton has a seasonal tendency to rally thru most of March and establish an important seasonal high at the end of the month.   Commercials are holding the largest net short position since January of 2004. Large traders (hedge funds) are holding the largest net long position since then. Small traders are neutral.

Disclaimer: There is risk of loss in all commodity trading. The data contained are believed to be reliable, but have not been independently verified by Pearce Financial. Accordingly, such data cannot be guaranteed as to reliability, accuracy, or completeness, and as such are subject to change without notice. Pearce Financial will not be responsible for any indirect, compensatory, or consequential damages, including loss of profits which may result from reliance on this data. Pearce Financial and/or its Principals and employees may or may not follow strictly any or all of the trading recommendations contained herein. The risk of trading futures and options can be substantial. Each investor must consider whether this is a suitable investment. Past performance is not indicative of future results.

© 2004 Pearce Financial, LLC
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