Lately, the financial media has followed around the commodities sector like paparazzi pursue celebrities, tweeting: "OMG! Sugar soars to 30-year high," and "Grain Prices Busted: Corn caught with other crop supply!"
In fact, paparazzi do have something in common with the mainstream financial observers: They also focus on the "external" factors. With their lens pressed up against the window of action, it's a matter of "see-and-wait" -- and then react. First the story breaks -- and then it's a race to put the rapidly changing pieces together, AFTER the fact.
Take the recent news reports regarding the long-term commodities outlook -- or, lack of one, to be more exact. See, according to the some mainstream sources, the "waters" of foresight surrounding the commodity sector have been muddied by a number of growing uncertainties: unclear crop conditions in Australia; chaos in Egypt and across the Middle East; instability in emerging markets; unknown future demand in China; unclear status of the U.S. economic recovery... And the most unreliable factor of all: the fluctuating swings of Mother Nature. On this, the recent news item below sets the scene:
"Weather is now a factor that is analyzed before anything else is taken into consideration simply because it has become so unpredictable that any other analysis becomes almost irrelevant if you get the weather component wrong." (gulfnews.com)
It's true that weather-related supply fluctuations play a role in commodity prices. But if you watch commodities closely, you know how often market participants will disregard a weather-related factor and buy or sell the market anyway, throwing the logic of "fundamentals" completely out the window. Look at the weather before anything else, they say? I don't think so.
See, all too often, what determines commodity trends is not the news per se -- it's traders' and investors' reaction to the news. And while you can't predict the day-to-day news, you can predict people's reactions. How? By using Elliott wave analysis, which tracks and forecasts collective psychology of the marketplace.
Wave analysis doesn't look at the externals. It looks at the markets from the inside-out by studying chart patterns, not the headlines. Elliotticians use objective, mathematical markers to identify specific wave patterns underway -- often even BEFORE they even begin.
Here at EWI, the go-to-guy for that job is EWI's chief commodity analyst and veteran
Futures Junctures Service editor Jeffrey Kennedy. And, in the
March 18 Daily Futures Junctures "Weekly Wrap-up" (
online now, free, via your FreeWeek pass) Jeffrey provides detailed price charts and video commentary on the near-, and long-term trends underway in 19 key commodity markets: From cocoa to crude oil, and lumber to live cattle, "Weekly Wrap-up" offers expansive coverage of the world's foremost futures.
And, the best part is, right now and through noon on March 23, you get all this analysis at the unbeatable price of $0.00. Club EWI members and existing subscribers have free access to both Futures Junctures Service publications: Monthly Futures Junctures and Daily Futures Junctures.