Are Commodities Breaking Out?

Chart 1: Important news this week is the commodity index break out!
Source: Short Side of Long
To say that commodities have under-performed other major asset classes in recent times (equities, bonds and cash) would be an understatement. Both the CC Index and CRB Index peaked out in May 2011, during the optimism of the Chinese economic growth and time of huge M&A deals such as Glencore merger with Xstrata. Fast forward almost three years later and the CC Index has barley managed a 5% gain over any recent 12 month period. Furthermore, over the last 52 weeks, most individual commodities have been sold off sharply (in particular agriculture and precious metals). However, interesting development took place this week, as the technical downtrend was broken (see chart above).  (more)

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