Commodity Update: WTI Crude Gives Up Nearly 1.5%

Energies: WTI Crude oil gave up nearly 1.5% today and has settled below the $100/barrel level the last two sessions. I do not see stiff support for another $3. With growing supplies and slack demand Bulls are losing control. I will look to be a buyer from lower levels with clients. As for the products both RBOB and heating oil will likely work lower short term. Both products trading under their 18 day MAs which is a bearish signal. The major drag today at least for some of my energy clients is the blowout of the Brent/WTI spread which has moved $3 the last last two sessions. On a bounce back near $9 premium to Brent I will look to cut losses. Down the last five out of six sessions nat gas has given up 7% closing under its 61.8% Fibonacci level today. The path of least resistance should remain down. I am looking for an other 10-15 cents of depreciation though the easy money has been made in my opinion.

Financials: Fresh record highs in the S&P, Nasdaq, Russell with the Dow lagging. The path of least resistance remains up across the board but I remain a spectator and will not drink the Koolade on this go-around.

Metals: Metals remain a trader's market. In just over the last two weeks gold futures trade lower by $80/ounce only to do an about face and trade $90 higher. Today futures stopped at their 50 day MA in December coming in at $1342. Do not rule out trade near the August highs if the dollar continues to crack. Silver has gained four out of the last five sessions closing near four week highs. Do not rule out a $24 trade. In full disclosure I have no fresh bullish or bearish trade recommendations until I get a clearer picture.

Softs: It appeared cocoa was going to correct from overbought levels but futures have recovered in the last two sessions to post fresh two year highs. I have advised clients to cut losses on bearish trades. Get off the tracks! Aggressive traders could lightly work into bearish trades in sugar looking to play a correction. OJ is trading near 13' lows. Probing bullish trades is on my radar in January juice. If coffee were to trade 5% lower bullish trade would be on my radar...until then stand aside.

Agriculture: Corn continues to base out around $4.40 level though today's action was bearish. If yields continue to get higher then prices will continue to get lower. A trade closer to $4/bushel is expected in the coming weeks. The 50 day MA has capped upside the last four session in soybeans. $13 remains a key pivot point and the next few days a decision will be made on direction..your guess is as good as mine so I have no exposure with clients. I advised bullish trades in soybean oil futures to take profits and buy a dip if given the opportunity For call option holders stay the course. $7 is the line in the sand in wheat. Yesterday's higher trade and lower close/reversal could prove to be an interim top. My suggestion is bearish trade trying to capitalize on a 20-30 cent correction.

Livestock: I've never been accused of being a vegetarian as I consume a lot of meat but I am far from an expert when trading livestock products. Cattle and lean hogs look like they are priced too high currently but that has been the case for several weeks so stand aside until we get a fundamental catalyst to get meat products moving south.

Currencies: The US dollar is posting fresh 13' highs. Chart damage was done and lower trade is the trade unless the Taper dialogue picks up again. Fresh 13' highs in the Euro and Swiss. Those probing bearish trade should have been stopped at a small loss. Those holding Euro put options give it a few days to see if these levels hold. Some clients continue to hold bearish option plays in the Yen as we would look for a challenge of last weeks lows or a trade slightly lower as our exit widow.

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