By Sonja Elmquist and Jeff Wilson Jan. 21 (Bloomberg) -- A measure of commodity prices slipped below its 40-day moving average yesterday, which may signal a decline of as much as 9 percent by March, said Paul Hare, a technical analyst with the Linn Group Inc. The Continuous Commodity Futures Price Index of 17 raw materials including oil, gold and corn dropped below its moving average of about 484 yesterday for the first time in six weeks, before settling at 486.56. If the index closes below its 40-day average this week, it will slip further to 443 by late February or early March, Hare said. “It looks like the market is completing its upturn for the near term,” Hare said yesterday from Chicago. “When markets complete those types of moves, you’re at a point where you can expect trends to reverse or slow down. A close under the 40-day average would indicate we’ve had a recent high.” A drop to 443 would mark a 50 percent retracement of gains during a commodity rally that began in July, Hare said. From a low of 381.65 on July 8, the index jumped as much as 32 percent to a high of 504.76 on Jan. 11. Since then, it is down 3.6 percent. To contact the reporters on this story: Sonja Elmquist in Chicago selmquist@bloomberg.net; Jeff Wilson in Chicago at jwilson29@bloomberg.net.

Source