The CRB index
equity bulls love to point out that the rise in CRB from 181 is a sign of a recoverying economy and rising end user demand
I do not buy that at all.
When you look at the components of the CRB you will see a good chunk of its rise was due NOT to end use demand but one-off type things
the drought caused a rise in food prices, the speculation in war caused the rise in oil prices
the most recent numbers reflect the west coast port shut down casuing a artificial cut-off of supply as well as increase of transportation as they used air and other means to tranport products.
It also included the automakers attempted to bring back financing costs.....as we know end demand just fell off a cliff and they have gone back to 0% financing
So if the weather gets better wheat prices will get better (specualte on wheat transport companies?) I have heard analysis that says after the spike that will come from the start of war, it could likely come back down to $20....which explains current softening
and when you think about it the US have been "bombing" in earnest for quite a while...the war has already started and the yanks have been busy "shaping the battlefield"...the only difference will be the intensity
the crb as can be expected is cyclical even within a long term down trend...it goes up and breaks the top bollinger band...and inevitably goes down to reload at the bottom of the bollinger band...the monthly chart suggests that upside is limited...and shorter term there are signs that it is already rolling over
PS
I tried to attach the monthly long term chart but it doesn't seem to want to take....but a long term chart is worth looking at