Technical Analyst, Saxo Bank Group
Wheat sell-off indicates exhaustion. Divergence on RSI during the probable last leg down last week indicates weakening o the downtrend i.e. we could very well see a rebound. A rebound that should take Wheat back to around last weeks peak at around $935-940. It can be a struggle however, and if Wheat breaks below $765.75 the support at $736 is likely to be tested.
That scenario is likely to unfold if RSI breaks below its rising trendline.
Corn has bounced twice from strong support at around $585. It is not unlikely it will have another go at that support. At the time of writing RSI is below its rising trendline indicating that Bears will try a third time pushing Corn below the support. If Corn closes below this support next is around 548.50.
If Corn trades above 623.50 the selling pressure is likely to be over and done with, and Corn could rebound to around last week’s peak and the 200 SMA around 613-667.
Soybeans formed a Bottom and Reversal pattern two weeks ago with a Doji followed by a very bullish day. It is not a perfect Doji Morning pattern but it indicates power has shifted from sellers to buyers. Strong support at $1,429.50 seems to hold. A continued rebound to around 1,562-1,579 seems likely.
If sellers come back with renewed energy and push Soybeans prices below 1,424, Soybeans could drop to support at around 1,349.
Coffee broke bearish last week followed by heavy selling pushing the Coffee price below its 55 weekly SMA for the first time in 9 months, down to the 0.382 retracement of the past 12 months uptrend. (weekly chart). Down trend is confirmed.
However, Coffee is likely to see a few days or weeks with sideways/rebound trading. If a rebound makes RSI close above its upper falling trendline it could indicate the trend is about to reverse.
If, on the other hand, coffee prices move below 203 we are likely to see new lows below $194
Cotton initiated the sell-off in Soft Commodities before the other Soft’s followed. But now the selling seems to be over. Divergence on RSI and a Bullish Engulfing candle on the 15th July strongly indicates a bottom and reversal in Cotton. Just a few cents above the support at $90. If Cotton closes above its short term falling trendline a rebound is likely to the 0.382 retracement at around $112 but it could be extended to around 118-122, the 0.50 retracement and 200 SMA.
AI: The good, the bad, and the bubble
While a deep recession may not be iminent thanks to central bank policy, interest rates will have to stay high for longer, and this will be accompanied by volatility risk from the unwinding of bubbles, especially within AI.
Steen Jakobsen,
Chief Investment Officer
The emergence of advanced AI systems is by far the most surprising event this year, turning everything upside down, while risks and benefits are debated. AI will also become an arms race between the US and China.
Peter Garnry,
Head of Equity Strategy
As China navigates global fragmentation, its cycle of technology application, productivity enhancement, and growth is threatened by US breakthroughs in generative AI, limited computing power, and geopolitical tensions.
Redmond Wong,
Market Strategist
Japan’s expertise in semiconductors and robotic integration could be the foundation of AI dominance. Combining two of this year's themes, Japanese equities and artificial intelligence, brings a wave of opportunities.
Charu Chanana,
Market Strategist
The AI fever has turned the technology into a darling, pushing crypto further into no-man’s-land. There are striking similarities between AI and crypto, and if these are to come full circle, AI won't be spared for bubbles.
Mads Eberhardt,
Cryptocurrency Analyst
Stocks related to artificial intelligence (AI) have appeared on investors' radars. Expectations are high, but it may be necessary to consider how to get exposure to AI in a diversified way.
Hans Oudshoorn,
Trainer Academy
The USD is on its back foot as markets celebrate an eventual Fed rate peak and steady long US yields. The stakes are even higher for the Japanese yen if longer major sovereign yield curves have to price in economic acceleration.
John J. Hardy,
Head of FX Strategy
While commodities, broadly speaking, have faced some tough months, a partial reversal during June could signal that the asset class is getting back on its feet with energy holding up and precious metals with upside potential.
Ole S. Hansen,
Head of Commodity Strategy
As inflation remains high central banks face hard decisions about whether they should keep hiking interest rates or stop. Meanwhile, the rise of AI creates bubble-like conditions that only make the decision harder.
Althea Spinozzi,
Senior Fixed Income Strategist
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