In a May 2, I concluded that Lumber is in a bearish trend and the trend is always your best friend. The path of least resistance of physical lumber futures could depend on the Fed’s monetary policy path over the coming weeks and months. Higher rates will likely be bearish, while rate cuts could ignite an explosive upside move. Nearby July physical lumber futures were at the $527 per 1,000 board feet level on May 1 and have only edged higher to the $538.50 level on June 1. …We could see a sudden rally if mortgage rates fall below 6%, as many existing homeowners have financing at or below the 3% level. The existing home shortage means the demand for new construction could soar, and lumber is the critical ingredient in homebuilding. …Lumber prices are stuck in neutral, for now. When they decide to move, watch out, as another period of explosive and implosive price action will likely follow.