Corn Estimated Fund Position
Trends – December Contract
Short Term:Down Net Long Futures and Options: -70833
Long Term: Down Change: +18000
Overnight Trade: Z -2 @7:30 AM
Corn traded both sides of unchanged overnight as traders prepared for tomorrow’s supply and demand report. Forecasts are calling for some areas of above normal temperatures and below normal precipitation in the western Corn Belt, which has helped to push the market higher the past two days and now traders have to deal with what will likely be a bearish supply and demand report. Shortly after the report, it will be right back to trading weather. The Sunday night forecasts will be critical and determine the direction of the market.
Wheat Estimated Fund Position
Trends – September Contract
Short Term: Down Net Long Futures and Options: -66283
Long Term: Down Change: +5000
Overnight Trade: Chicago: U -1 KC: U -2 @7:30 AM
The September KW moved out of the recent trading range, but stalled out at the 38% retracement of the last leg down. $7.15 looked like a potential upside target for the market, but it may have already run out of momentum. Tomorrow’s report should be slightly friendly, but will probably not hold much market moving information. The direction of the corn market will still have a great deal of impact on the price of wheat.
Soybeans Estimated Fund Position
Trends – August Contract
Short Term: Up Net Long Futures and Options: 83086
Long Term:Up Change: +9000
Overnight Trade: X +3 @7:30 AM
Yesterday the November soybeans nearly reached the 62% retracement of the last leg down, so that may be enough strength in that market for the time being. Tomorrow’s report has a chance of being very bearish since crop condition ratings are well above average. The bulls really need this weather threat to continue if we are to see consistent gains in the market. Improved forecasts will be devastating to the market.
Short Term: Up
Long Term: Up
Opening Calls: Mixed
Live cattle futures closed moderately higher on Tuesday, with deferred contracts posting highs for at least a two month period. Cutout values were mixed on the day, with hide and offal values setting new record highs. Overnight activity has been in a narrow two sided trading range. The live cattle open interest continues to gain in a slow grinding move to the upside. We consider this activity to be long term supportive for the market. Cash trade is once again expected to be delayed until very late in the week.
Short Term: Up
Long Term: Up
Opening Call: 20-40 Lower
Feeder cattle futures settled moderately lower on Tuesday, recovering more than half of their early day losses. The culprit once again was the sharply higher trade in new crop corn values. Weakness in overnight trade has held above Tuesday’s lows, which should provide solid support if corn futures retreat. Corn has traded in a 10 cent range overnight, with current price levels dipping to 4-5 cents lower. Support near 150.00 in the August contract should now be a key area to watch. Cash remains a big discount, with the index only posting minimal gains on Tuesday.