FUTURES MARKET OVERVIEW

Energy | Financials | Grains | Live Stock | Metals | Softs

The Futures Market Overview section is designed to provide you with an introduction to the commodities markets.

We have attempted to isolate the key fundamental factors which effect the various markets year in and year out, by presenting the normal production and consumption cycle of the various markets.

Inside each overview, we also present the typical seasonal pattern of the markets.  Seasonal analysis is a powerful tool for describing the normal behavior of the markets.  Though not fool proof, seasonal analysis presents a basic overview of how the market normally reacts to various inputs during specific times of the year.  Of course each year is different, and as such may not follow the "normal" seasonal pattern.  But, it has been our experience that seasonal analysis provides a good basic frame work for analysis, hence we have included seasonal analysis in the overviews.

ENERGY - Crude oil | Gasoline | Heating Oil | Natural Gas

The energy futures market has been a hotbed of activity lately.  War and mayham in the Middle East, coupled with shenanigans by OPEC have made this market extremely interesting. The Petroleum market is not only a demand lead market, but also a barometer of tendsions in the Middle East.  When hostilities flair up, Crude Oil and the petroleum product futures tend to increase as supply is threatened.  Usually this reaction is too fast for most to take advantage of... but if you have the inside track you may be able to d

FINANCIALS - US-Dollar | CRB index | Stock Index | Foreign Exchange

In today's global economy, large and small companies alike are constantly working with foreign currencies. The continuous fluctuation of currency rates can make it difficult for businesses to anticipate costs and forecast profits. More than ever before, there is a need for currency futures, so that businesses can protect themselves from exchange-rate risks in multinational transactions of all types.

GRAINS - Corn | Soy Bean | Wheat | Oats

The grain markets follow a fixed cycle of production, flowing from planting to harvesting at specific times of the year. During these stages of development, the crop is vulnerable to damage from the forces of nature.  During planting, too much rain fall can make field work difficult to impossible.  Late plantings can result in loss of acreage or late development which can result in a lower quality crop or lower yields.  Too little rain can prevent seeds from proper germination, resulting in loss of production as well.

LIVE STOCK - Cattle | Feeder Cattle | Lean Hogs | Pork Bellies

The Cattle industry is truly the last bastion of small independent producers left in United States agribusiness. Approximately 67 percent of the Cattle produced in the United States are small to mid size, single, family-owned Cattle operations with less than 500 head. According to a survey done in 1996, almost half of the Cattle businesses in operation have been in the same family for over 50 years.

METALS - Gold | Silver | Platinum | Copper

Gold, Platinum, and Silver often referred to as precious metals. We are all familiar with them and the twinkle they bring to our eye. The last 15 years or so have not been very good times for the "precious metals". They have been increasingly used for industrial purposes and in electronics. Since the Bretton Woods accord in November of 1973, that took the US dollar off of the Gold standard, gold has not been used to back our currency. Banks no longer use Gold or Silver to back their currencies, opting for interest rate items, that do not incur storage or security costs

SOFTS - Coffee | Cocoa | Cotton | Sugar | Orange Juice | Lumber

Unlike the other commodity groups, softs are also known as food and fiber because this group is mainly composed of food related items (cocoa, sugar, and orange juice) as well as Cotton, which can be considered a fiber. This group behaves very similarly to the grain markets.  Planting tends to be the strongest time of the year, while highs are typically made during pollination, and just prior to harvest the lows are seen.

The other reason this group tends to segregated from the rest of the commodities is that the bulk of production is done outside the United States.  Because production is centered in third world countries (Africa, and South America), statistics regarding production are not as reliable, as the USDA is the most accurate and diligent statistical source in the world.

To learn more, contact our professional consultants today: 1- 800-974-8744

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