The GSCI Commodity Index ((GSG)) consists primarily of Energy (71%), but also contains Agriculture (14%), Industrial Metals (7%), Livestock (4%), and Precious Metals (4%). The index fell below the 50-day moving average, falling to the 34.40 support level. With the dollar likely to strengthen further, contingent on the government not pursuing another round of quantitative easing, look for the index to test the 33.80 level. Long-term prospects for the GSG don’t look to great.
The Dow Jones-AIG Energy Total Return Index ((JJE)) consists of Natural Gas, Crude Oil, Heating Oil, and Unleaded Gas. The index has continued tumbled since it broke its upward trend line.
The DJ-AIG Grains Total Return Index ((JJG)) consists of Corn, Wheat, and Soybeans. The index is the best performing commodity index, as its above both the 50-day and 200-day MA and above the upward trend line.
The DJ- AIG Industrial Metals Total return Index ((JJM)) includes Aluminum, Copper, Nickel, and Zinc. Along with energy, its one of the worst performing sub-indices. Is it a precursor to a weakening US economy? Copper prices are leading economic indicators, and have been stumbling of late.
The DJ-AIG Precious Metals Index ((JJP)) includes Gold and Silver. With the Fed in no hurry to renew QE, the index has broken down, breaking below the 50-day, 200-day, and short-term upward trend line.
The DJ-AIG Softs Index ((JJS)) includes Coffee, Cotton, and Sugar.