Schwieterman: Feeder cattle futures closed moderately higher Mon.

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Corn Estimated Fund Position

Trends – December Contract

Short Term:Down Net Long Futures and Options: 8099

Long Term: Down Change: -10000

Overnight Trade: Z Unch @7:30 AM

The corn was flat overnight in very low volume trade. The December contract held above $4.00 yesterday, so the market is at a good spot for some consolidation. However, the gap lower on the chart looks rather ominous and one should expect lower prices in the future. Crop condition ratings were unchanged at 75% Good to

Excellent, which is well above average and gives traders confidence in a huge yield. One of the biggest problemswith the market is that the trading funds are still net long, so there is a lot of room for selling the rest of the summer.

Wheat Estimated Fund Position

Trends – December Contract

Short Term: Down Net Long Futures and Options: -66121

Long Term: Down Change: -6000

Overnight Trade: Chicago: Z +2 KC: Z +3 @7:30 AM

The wheat bounced a little overnight after the Kansas City contracts found support near the 75 and 78% retracements. Unlike the corn, the trading funds are already quite short, so they don’t have quite as much ammunition to pressure the market. Also, Friday’s supply and demand report has a good chance of being friendly, which could result in a little short covering later this week. Otherwise, the trends are still down and the weakness in the corn and beans is the biggest problem right now.

Soybeans Estimated Fund Position

Trends – November Contract

Short Term: Down Net Long Futures and Options: -40938

Long Term: Down Change: -4000

Overnight Trade: X -2 @7:30 AM

Like the corn, the gap lower in the soybeans looks really bearish on the charts, but so far we haven’t seem much follow through selling. Crop condition ratings were unchanged at 72% Good to Excellent, so the bears have no reason to expect anything other than a great yield. The best hope for the beans is demand, and it seemed that the large export sales supported the November contract yesterday. Unless there is a major change in the weather, the trend will remain down, so look for the November contract to test $11.00 this week.

Live Cattle

Trend

Short Term: Up

Long Term: Up

Opening Calls: Mixed

Live cattle futures closed lower on Monday, after posting new contract highs in early morning trade. The reversal action will bring a few more sellers to the table as we go forward. Show lists for the week appear slightly larger than a week ago, while futures prices are still discounted by 3.00 to week ago cash. The lower close on Monday appeared to be long liquidation, with open interest falling more than 5,000 contracts. Overnight trade has been two sided with a slightly firmer bias as we write. Boxed beef prices were modestly higher.

Feeder Cattle

Trends

Short Term: Up

Long Term: Up

Opening Call: 10-30 Lower

Corn Estimated Fund Position

Trends – December Contract

Short Term:Down Net Long Futures and Options: 8099

Long Term: Down Change: -10000

Overnight Trade: Z Unch @7:30 AM

The corn was flat overnight in very low volume trade. The December contract held above $4.00 yesterday, so the market is at a good spot for some consolidation. However, the gap lower on the chart looks rather ominous and one should expect lower prices in the future. Crop condition ratings were unchanged at 75% Good to

Excellent, which is well above average and gives traders confidence in a huge yield. One of the biggest problemswith the market is that the trading funds are still net long, so there is a lot of room for selling the rest of the summer.

Wheat Estimated Fund Position

Trends – December Contract

Short Term: Down Net Long Futures and Options: -66121

Long Term: Down Change: -6000

Overnight Trade: Chicago: Z +2 KC: Z +3 @7:30 AM

The wheat bounced a little overnight after the Kansas City contracts found support near the 75 and 78% retracements. Unlike the corn, the trading funds are already quite short, so they don’t have quite as much ammunition to pressure the market. Also, Friday’s supply and demand report has a good chance of being friendly, which could result in a little short covering later this week. Otherwise, the trends are still down and the weakness in the corn and beans is the biggest problem right now.

Soybeans Estimated Fund Position

Trends – November Contract

Short Term: Down Net Long Futures and Options: -40938

Long Term: Down Change: -4000

Overnight Trade: X -2 @7:30 AM

Like the corn, the gap lower in the soybeans looks really bearish on the charts, but so far we haven’t seem much follow through selling. Crop condition ratings were unchanged at 72% Good to Excellent, so the bears have no reason to expect anything other than a great yield. The best hope for the beans is demand, and it seemed that the large export sales supported the November contract yesterday. Unless there is a major change in the weather, the trend will remain down, so look for the November contract to test $11.00 this week.

Live Cattle

Trend

Short Term: Up

Long Term: Up

Opening Calls: Mixed

Live cattle futures closed lower on Monday, after posting new contract highs in early morning trade. The reversal action will bring a few more sellers to the table as we go forward. Show lists for the week appear slightly larger than a week ago, while futures prices are still discounted by 3.00 to week ago cash. The lower close on Monday appeared to be long liquidation, with open interest falling more than 5,000 contracts. Overnight trade has been two sided with a slightly firmer bias as we write. Boxed beef prices were modestly higher.

Feeder Cattle

Trends

Short Term: Up

Long Term: Up

Opening Call: 10-30 Lower

Feeder cattle futures closed moderately higher on Monday but more than 1.50 off of contract highs posted in early morning trade. Some modestly lower cash trade in the salebarns over the last few days could be suggesting at least a slowing of the recent windfall gains. The cash index has dropped 2.62 since reaching its all-time high of 217.20 on Wednesday of last week. overnight trade has been two sided, with a lower bias in the deferred contracts.

Some modestly lower cash trade in the salebarns over the last few days could be suggesting at least a slowing of the recent windfall gains. The cash index has dropped 2.62 since reaching its all-time high of 217.20 on Wednesday of last week. overnight trade has been two sided, with a lower bias in the deferred contracts.


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