It's Deja Vu All Over Again - Commodities React to Downgrade
The levee broke once again as world markets reacted to S&P's decision to downgrade the US credit rating. Commodities opened down over 7 cents on Sunday night and didn't look back. Trading in negative territory all day and then banging the close with about 20 minutes left in the session. HEAT fell as much as .1530 before clawing its way back to finish down .14 to 2.8017. RBOB coincidentally, was holding up for much of the day as it languished down around 4 cents before falling .1136 to $2.6916. WTI fell a staggering $5.57 to $81.31. The devil is in the details though, the 2.80 level on HEAT, while breached, held for the close, same can be said for the $80 mark on WTI. Look for a buy back on Tuesday with further downside to come the remainder of the week as money continues to get pulled out of commodities.