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Is Lumber Signalling Bad News for US Manufacturing?

Is Lumber Signalling Bad News for US Manufacturing?

Lumber CME:LS1!

Lumber is highly correlated to the ISM manufacturing index (or vice versa?). Nevertheless, the weakness in lumber prices is corresponding with the softening manufacturing data, although manufacturing data from Markit suggest manufacturing is weaker than ISM reports. New orders index collapsed from Nov/Dec 66 to 57. Prices have noticeably declined, too. Anyways, price action is nestled so snugly on price action support at $310.XX, while support was found on the uptrend channel support. This also aligned with a small asymmetrical triangle. A close below these levels, prices are likely to sell-off to $278, while $268 remains a possibility on weakening economic data. However, a rally from these levels could push prices to $326.