If we are in the midst of a risk appetite rethink, a reversion of capital flows from the periphery (emerging markets and riskier investments) to the center (large, developed capital markets), then commodities may be commencing the next leg of a major downturn.
Technically, using the S&P 500 as a gauge of broad risk appetite, I can make the case for the recent rally to have ended this week:
Of course, there is still potential we get another week or two of upside to test this week's high. But the fact that the technical pattern has played out as I expected, and its culmination has been met with further fundamental disappointment, it makes sense to begin positioning for what seems like a much needed drop ... across all markets ... to come.
Here are some bullets showing just how sour the news has been this week:
No new recommendations or adjustments at this time.