A bottom -temporary or not-may be forming in the commodity sector. Copper is holding the 3$ level and oil is hovering around 100. Gasoline and Heating Oil are rallying sharply. This engineered selloff by the authorities to blast the overleveraged hedge funds out of the market has had the desired result of reducing the froth in the hard asset camp. Now the return of demand will provide a fundamental floor for some of these commodites. The big scare of slowing Chindian economies is not really happening-the law of large numbers is taking hold. .
Dr. Copper is indicating that global growth is not going to go negative, but it will slow down to more sustainable levels. Brazil is raising rates, while New Zealand and Australia are chopping rates. The Baltic Freight Index has dropped as the supply of ships is overwhelming the amount of goods to be transported. US Retail sales are weak-no surprise since no one can get financing. US is in recession and the slow growth and credit contraction period has a long way to go.
As a side note-whenever the mains stream media (MSM) run articles making predictions about future price levels from secand and third tier fund managers-perk up your early warning indicators. Who cares what a 50-100m $ fund thinks-there are 3000 of them around. Watch the charts and look for divergences-that will tell the true trend.
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