If the Sunday night futures market was to be given a movie title it would have been dubbed the "Commodity Catastrophe"; we saw WTI crude futures fall below $64/barrel, silver traded with a 14 handle ($14.43 low), and copper fell into the $2.70s. Thus far this morning we are witnessing a bevy of "V-bottoms" across the commodity complex. Gold, for example, has now reversed all of Friday & Sunday night's losses in just a few hours this morning:


After falling as low as $1141 gold futures are back up to $1197 - the $1200 level is becoming important support/resistance and also represents a key psychological level for the gold market.

It seems to me that Thursday, Friday, and Sunday evening's trading in commodity futures were greatly exacerbated by the US Thanksgiving holiday and the fact that many market participants were away from their screens. The lower liquidity in addition to the bearish OPEC announcement on Thursday morning served to exaggerate the downside move in markets that were already fragile. Thin, fragile markets coupled with this morning's reversals offer a good probability that Sunday night's lows will stand to be short-to-intermediate term lows for many commodities including crude oil and gold.