Corn Estimated Fund Position
Short Term: Up Net Long Futures and Options: 271380
Long Term: Up Change: -16000
Overnight Trade: Z +4 @7:30 AM
Pro Farmer will release their final assessment of the crop tour after the close today so it wouldn’t be a surprise to see some buying going into the close today in anticipation of a low production estimate. The numbers from Iowa and Minnesota suggest that USDA will need to make small cuts in their yield estimates in those states. The big unknown to me is still the number of harvested acres. Yesterday’s profit taking took the December corn down to the 9-day moving average and so far that area is holding. A close below that level would suggest a move down to the $7.80 area. For now I am still looking for a test of the $8.50 level soon.
Wheat Estimated Fund Position
Short Term: Up Net Long Futures and Options: 26840
Long Term:Up Change: -4000
Overnight Trade: Chicago: Z +7 KC: Z+9 @7:30 AM
The December KW left a fairly ugly looking bar on the chart yesterday, but like the corn, the market is holding at the 9-day moving average. Wheat fundamentals have not improved enough to turn the wheat market into the upside leader, but at this point I just can’t see a sustained price break, because it will only create more demand for wheat and that is something that we probably don’t need in the long run. Prices breaks now will result in higher prices later.
Soybeans Estimated Fund Position
Short Term: Up Net Long Futures and Options: 212517
Long Term:Up Change: -5000
Overnight Trade: X +14 @7:30 AM
The profit taking in the soybeans was probably the most surprising to me since the fundamental outlook continues to improve. None the less, we are left with an outside day down on the charts in an overbought market. That suggests further weakness, but I guess I am not willing to bet on that. The market has made a decent recovery overnight and a new high today would negate the reversal lower. If we do get a break, it is a buying opportunity.
Short Term: Up
Long Term: Up
Opening Calls: Mixed
Live cattle futures closed moderately higher on Thursday, with support from steady southern cash trade and a weak Dollar. Pressure on equities over the past few days created some early anxiety, but the cash markets strength was enough to reject the stock weakness. We have seen narrow two sided trade in the overnight business, as traders look for further direction. The market remains range bound , with chart patterns showing no real energy.
Short Term: Up
Long Term: Down
Opening Call: Mixed
Feeder cattle futures posted impressive triple digit gains on Thursday, pushing back into the top end of the recent trading range. Weakness in corn on Thursday was the catalyst for the feeder rally. Overnight corn prices are firmer, putting a little damper on feeders. Look for sellers to be found in the high end of this trading range. Early placements during August are considered to be down 5-8%.