Commodities Crossroads: Bulls Don’t Want To See Selling Here!

TR Equal Weighted Commodities Index “Monthly” Chart

Commodities are nearing a decision point. The Thomson Reuters Equal Weighted Commodities Index is testing the top side of its 7-year falling channel (A) at point (1).

Will the downtrend channel remain intact?  Or will Commodities breakout to the upside, providing a bullish signal to investors?

We should know soon enough! The index price is getting sandwiched between the downtrend line resistance (1) and a multi-month uptrend support line (2).

And this is all occurring at a critical Fibonacci retracement level:  the 23.6% Fib.  This level often characterizes trend changes.  So a breakout here would go a long way to helping bulls start a new leg higher.

On the flip side, a move lower that breaks through the uptrend support line would send a frustrating message to bulls.  Think Gold, Crude Oil, Natural Gas, Silver, Corn, Wheat, Sugar, and many more commodities.

This is a big spot.  And something has gotta give. Stay tuned!

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