Get out your potting soil and pruning shears: April is National Garden Month. But for those of you more interested in the "flowerbeds" of financial opportunity, EWI's chief commodity analyst Jeffrey Kennedy has the ultimate green thumb.
And, in the just-published April 2011 Monthly Futures Junctures, Jeffrey reveals which commodity markets will blossom in the coming weeks -- and which ones will see their bloom come off the rose.
Hot Coffee: In the opening "Featured Market" segment of the April Monthly Futures Junctures, Jeffrey reveals how coffee's bullish roots have outgrown their original pot -- as forecast in the June 2010 MFJ. In that publication, Jeffrey foresaw a "large and lasting post-triangle thrust... that could easily see prices double from current levels."
Since then, coffee has done just that in a powerful upsurge to 30-year highs. Still, it would take an additional 25% rally to exceed the market's all-time peak of 1977. Is such a feat possible? Well, in the April publication, Jeffrey examines the evidence -- Fibonacci time and price targets, Elliott channels, the London equivalent -- and weighs heavily in favor of one surprising outcome.
In the next row we have MFJ's "Wave Watch." Here, Jeffrey shows you two labeled snapshots per 12 markets, each with a clearly marked target and bold arrows pointing to the next likely direction for prices. Off the top are these familiar favorites:
Sugar: Despite a bullish fundamental backdrop of high demand, low supply, and adverse weather, the February 2011 Monthly Futures Junctures saw sugar's winning streak coming to end and wrote: "Let's not sugarcoat it. Wave patterns in sugar call for the current sell off from the February peak to continue."
What now? Well, the two charts in the April MFJ send one clear and undeniable message.
Cocoa: Last month, the March Monthly Futures Junctures went on high alert to cocoa's downside and said: "The stage is set for the next act: a complete retracement of the [previous uptrend]." The sharp and sudden reversal that followed pushed cocoa to its lowest level since the start of the year before turning up. Now, the April MFJ reveals whether the time to buy has arrived.
Cotton: The September 2010 Monthly Futures Junctures caught cotton's amazing climb before it began with this timely insight: "The internal subdivisions of these price moves argue for additional strength in the months to come. In fact, I wouldn't be surprised to see strength persist into the first quarter of 2011."
Cotton's powerful, seven-month uptrend to the April high speaks for itself. And so do the newly updated charts of cotton in the April Wave Watch.
Soybeans: The November 2010 Monthly Futures Junctures saw the weak streak in soybeans coming to an end and wrote: "The selloff from the November 2008 peak was wave (4) of a still developing motive wave that should push prices to the $14-$15 bushel range." Now, the April 2011 MFJ charts show whether the gains in this grain are set to continue.
Lean Hogs: In the February 10, 2011 Daily Futures Junctures, Jeffrey observed a major wave sequence coming to an end and issued this warning: "Once this five up wanes over the very near-term, be aware: price may then embark on a large, multi-month fall." From the February peak, hogs went to slaughter until bottoming in late March. Then, the March 2011 MFJ "Wave Watch" charts showed hog prices turning UP in a strong rally above the January highs. The newest MFJ now takes the baton.
Believe it or not, that's just the tip of the topsoil. The April 2011 Monthly Futures Junctures also includes an illuminating "Traders Classroom" series on two well-known Japanese Candlestick patterns: the "dark cloud cover" and "piercing line." In this educational segment, Jeffrey walks readers through the process in which both of these patterns successfully introduced tradable tops in the recent, real-time price action of live cattle, feeder cattle, the US dollar and the S&P 500.