Schwieterman: Little Sign Of Strength For Corn, Feeder Cattle Futures Move Higher
11/06/2009 08:22AM
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Corn Estimated Fund Position
Trends
Short Term: Up
Long Term: Up Net Long Futures and Options: 122431
Overnight Trade: Z -1 Change: -5000
Opening Calls: 1-2 Lower
The corn market didn’t add much to yesterday’s losses in overnight trade, but there was little sign of strength either. The outside markets haven’t been very influential this week, so maybe the stronger Dollar and weaker stock market won’t matter today either. However, I would be prepared to see the December corn move down to trend line support at the $3.66 level.
Wheat Estimated Fund Position
Trends
Short Term: Up Net Long Futures and Options: -33009
Long Term: Up Change: -4000
Overnight Trade: Chicago: Z +1 1/4 KC: Z +1
Opening Calls: Steady – 2 Higher
Wheat was slightly higher overnight, but if the wheat pays any attention to the outside markets today, then the gains won’t last long. Open weather and poor exports are two important negative factors this morning as are ideas that the rally in the corn and beans was overdone. The market has the potential to pull back to trend line support at the $5.01 area in the next couple of days.
Soybeans Estimated Fund Position
Trends
Short Term: Up Net Long Futures and Options: 38268
Long Term: Up Change: -5000
Overnight Trade: F + 1/4
Opening Calls: Mixed
The soybeans didn’t build on yesterday’s losses in overnight trade, which could lend to some optimism this morning. However, I would be concerned about the past two days of weakness carrying over into today’s session. The outside markets haven’t mattered too much this week, but with the open weather ahead and expectations for next week’s crop report still rather bearish, the outside markets will provide just one more reason to sell.
Live Cattle
Trend
Short Term: Up
Long Term: Up
Seasonal: Up
Opening Calls: Mixed
Live cattle futures failed to take out key resistance after rallying early in the session, ending narrowly mixed on Thursday. Cash trade was fairly active in Kansas and Nebraska, with prices hovering around last weeks highs. Cutout values were steady to lower and slaughter continues to taper back in order to sustain beef values. Many of the northern cattle bought on Thursday were asking for extra days. The unemployment numbers released this morning were significantly higher than expected, putting a damper on the equity rally and pushing back improving demand ideas.
Feeder Cattle
Trends
Short Term: Up
Long Term: Down
Seasonal: Up
Opening Call: Mixed
Feeder cattle futures appeared to break out to the upside over the past two days, led by the January contract gaining 1.90 over the two sessions. Any weakness in deferred live cattle futures is likely to stifle further rally attempts in the feeders. Corn prices were moderately lower on Thursday, and appear to have a lower bias heading into today’s open outcry session. The cash index was slightly lower as it continues to hover in narrow price range.