Corn Estimated Fund Position
Short Term: Up Net Long Futures and Options: 180823
Long Term: Up Change: +3000
Overnight Trade: Z +4 @7:30 AM
The corn posted a mediocre close yesterday, but is higher so far today. Yesterday’s high’s haven’t been taken out yet and the December corn looks like it will struggle with the $7.50 area again today. Fresh news is limited. There is some concern about wet weather in Argentina and hope for a repeat of last week’s export sales report. The key for the corn today could be the soybeans and soybean oil. A rally in those markets could spill over to the corn.
Wheat Estimated Fund Position
Short Term: Down Net Long Futures and Options: -20005
Long Term: Down Change: Unch
Overnight Trade: Chicago: Z +8 KC: Z +9 @7:30 AM
Crop condition ratings declined another point to 33% Good to Excellent and there probably won’t be any improvement soon. The December KW made another new high for the move over night and the market should be headed for a test of the 40 and 50 –day moving averages, which are now just below $9.00. The market is still basically stuck in the same old trading pattern it has been in since the summer and their doesn’t seem to be much reason to expect that to change now.
Soybeans Estimated Fund Position
Short Term: Up Net Long Futures and Options: 84779
Long Term: Down Change: +3000
Overnight Trade: F +12 @7:30 AM
The January soybeans made a new high for the move overnight as did the front months of the product markets. The key to the complex right now is the soybean oil and the huge export sales we have been seeing. There is also a record large net short fund position in the soybean oil, which means there could be massive short covering in that market. Look for a move to $15.00 in the January soybeans soon.
Short Term: Up
Long Term: Up
Opening Calls: 10-20 Higher
Live cattle futures closed moderately lower on Monday, in spite of several thousand head trading in Texas at even money with last weeks’ highs. We are hearing talk that cow meat is getting backed up. The rise in east coast demand may have reached a high point and backing off now. Show lists are larger than a week ago, particularly in the south. December contracts look heavy and become available for next weeks’ kill. As open as the weather has been, we expect contracts to ship in the first half of the month.
Short Term: Up
Long Term: Down
Opening Call: 10-20 Lower
Feeder cattle futures closed moderately lower on Monday, with lower fats and higher grains weighing on the market. Overnight prices are off another .20-.30 on more strength in the corn pit. We look for a potential 2-3 week setback in front end futures, as we take some premium out of the futures vs cash. Buying puts and selling calls near current levels could set up a good buying opportunity in a couple of weeks.