The Art of the Sell Side
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2015 has been difficult for commodity traders. The prices of agricultural products and related businesses fell below technical support levels. One common technique for determining the momentum of key commodities such as corn, live cattle, soybeans, cocoa, and wheat is to look at the chart of the Powershares DB Agriculture Fund (DBA).
This Exchange Traded Fund (ETF) is one of the most popular amongst agriculture investors and comes with an expense ratio of 89%.
It has been trading within a defined downtrend since late 2010 and the dotted trendlines have acted as strong levels of support and resistance. Currently, the price of the fund is trading near the lower support line, which suggests that the down trend is likely to remain in place for the rest of the year and into early 2016.
In all liklihood, bullish active traders will likely remain on the sidelines until the price is able to close above the upper trendline and its 200-day moving average...(Investopedia Commodities Trading, "Corn Traders are Bracing Themselves for More Selling," September 9, 2015).
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