Market Commentary - Wednesday, 28 February 2007

FOREIGN EXCHANGE

EUR/USD closed higher on Tuesday and the high-range closes sets the stage for a steady to higher opening on Wednesday. Prices this week have seen a bullish upside breakout from a recent narrow and sideways trading range. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term.

USD/JPY closed lower on Tuesday and the low range-closes sets the stage for a steady to lower opening on Wednesday. Stochastics and RSI are turning bearish signaling that sideways to lower prices are possible near-term. Closes above the reaction low crossing are needed to signal that a short-term low has been posted.

GBP/USD closed lower on Tuesday. The mid-range closes sets the stage for a steady opening on Wednesday. Bull's still currently have the technical advantage. Stochastics and RSI are neutral to bullish signaling that sideways to higher prices are possible near-term. Closes above this months trading range are needed to signal that a low has been posted.

USD/CHF closed lower on Tuesday and the low-range closes sets the stage for a steady to lower opening on Wednesday. Closes below the 20-day moving average crossing would signal that a short-term top has been posted. Stochastics and the RSI are turning bearish signaling that sideways to lower prices are possible near-term.



BULLION

Gold closed lower on Tuesday and the mid-range closes sets the stage for a steady opening on Wednesday. Closes below the 10-day moving average crossing will signal that a high has been posted. Stochastics and the RSI remain bullish signaling that sideways to higher prices are still possible. Closes above this month's high are needed to continue last week's rally.

Silver closed lower on Tuesday. The mid-range closes sets the stage for a steady opening on Wednesday. Closes below the 20-day moving average crossing would confirm that a top has been posted. Stochastics and the RSI remain bullish signaling that sideways to higher prices are still possible near-term.



U.S. STOCK MARKET INDICES

DJI closed lower on Tuesday and the low-range closes sets the stage for a steady to lower opening on Wednesday. Stochastics and RSI are overbought and are bearish signaling that a short-term top might be in or is near.

SPI closed lower on Tuesday and the low-range closes sets the stage for a steady to lower opening on Wednesday. It is likely there will be strong follow-through selling pressure on Wednesday morning. Stochastics and the RSI are turning bearish signaling that a high might have been posted.

NDI closed lower on Tuesday and the low-range closes sets the stage for a steady to lower opening on Wednesday. Stochastics and RSI are overbought and are bearish signaling that a short-term top might be in or is near.



ENERGY

Crude Oil closed slightly higher on Tuesday and the high-range closes sets the stage for a steady to higher opening on Wednesday. Bulls have recently gained confidence that a near-term low is in place, but those hopes may be dashed. Stochastics and the RSI remain bullish signaling that sideways to higher prices are possible near-term.

Natural Gas closed lower on Tuesday and the low-range closes sets the stage for a steady to lower opening on Wednesday. Bulls had the slight near-term technical advantage, but are likely to lose it on Wednesday. Stochastics and the RSI have turned bearish signaling that sideways to lower prices are likely.



COFFEE

Coffee closed down Tuesday. Prices closed nearer the session low amid the general selling pressure in many commodity markets today. Bulls are fading after showing some recent strength and the next upside price objective is the solid resistance at last week's high. Stochastics and the RSI are bearish signaling that sideways to lower prices are possible near-term.