Schwieterman: Feeder cattle futures reach new all-time highs

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Corn                                  Estimated Fund Position
Trends – December Contract
Short Term:Down             Net Long Futures and Options: -205991
Long Term: Down             Change: -5000
Overnight Trade: Z -3 @7:30 AM


The December corn fell below the $4.35 support overnight, which is an indication that the market is still on its slow trek to the $4.25 area. Traders are concerned about the good yield reports and fear that the EPA will lower the RFS. A lower RFS doesn’t necessarily mean lower corn demand, but it is negative psychologically. The corn market has been choppy or so long that it is hard to expect a change in that pattern. Don’t be surprised to see positive trade at some point today.

Wheat                                Estimated Fund Position
Trends – December Contract
Short Term: Up                  Net Long Futures and Options: -60219
Long Term:Up                    Change: -2000

Overnight Trade: Chicago: Z +1 KC: Z +1 @7:30 AM

The December KW continues to trade sideways. The overbought condition of the market is slowly being relieved, so it is possible that the market begins another leg higher from here. It would be nice to have an export sales report. Look for a retest of the recent highs.

Soybeans                           Estimated Fund Position
Trends – November Contract
Short Term: Down              Net Long Futures and Options: 89218
Long Term: Down               Change: -2000
Overnight Trade: X -5 @7:30 AM


Talk of lowering the mandate for biodiesel may weigh on the soybean market today, but at the same time export demand has been strong enough that traders won’t be aggressive sellers. The soybeans have traded sideways this week and there is a good chance that today is another directionless session.

Live Cattle
Trend
Short Term: Up
Long Term: Up
Opening Calls: Mixed


Live cattle futures finished moderately higher on Thursday, with all contracts between .20-.35 higher at the close. Cash trade remained at a standstill, with bids of $125 countered by offers of $128 or higher. October is putting in new highs for the move in overnight trade, with deferred contracts moving into key resistance levels across the board. We could certainly see a choppy session as the market struggles to resolve current activity based on limited fundamental news. We look for cash to improve at least a Dollar over week ago levels sometime this morning.

Feeder Cattle
Trends
Short Term: Up
Long Term: Up
Opening Call: 20-40 Higher


Feeder cattle futures continue to put in new all-time highs, posting triple digit gains again on Thursday. The strength stemmed from lower corn futures and shockingly high prices being reported in country sales. Overnight activity is more of the same, with corn posting contract lows and feeders making new all-time highs. Charts remain overbought and we continue to like option strategies for producers who can protect good profits at current levels.



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