Corn                                           Estimated Fund Position
Trends
Short Term: Up
Long Term: Up                            Net Long Futures and Options: 1837
Overnight Trade: Z -3                  Change: +25000
Opening Calls: 2-4 Lower


Traders took the freeze/frost potential to heart yesterday and the corn touched limit higher. There was, however, no follow through overnight. The biggest problem with long range forecasts is that they change, and the fear is that we will see warmer temps at some point this week and the market will come crashing down. If the forecasts can stay consistently cold, we will see more short covering. Meanwhile, the outside market influences are positive with the Dollar Index making new lows and the stock futures making new highs. Look for two sided trade today and look for the mid-day forecasts to determine the direction of the close.

Wheat                                           Estimated Fund Position
Trends
Short Term: Down                         Net Long Futures and Options: -65122
Long Term: Down                         Change: +4000
Overnight Trade: Chicago: Z -6 1/2 KC: Z -6 1/2
Opening Calls: 5-7 Lower


Wheat was higher yesterday, but not nearly as strong as the corn or soybeans. That is because there was little reason to be higher other than the strength in the corn and beans. The wheat needs to see the gains in the corn continue, because we still haven’t seen good enough demand to support consistent gains.

Soybeans                                       Estimated Fund Position
Trends
Short Term: Down                         Net Long Futures and Options: 14324
Long Term: Down                         Change: +10000
Overnight Trade: X -12 1/2
Opening Calls: 10-15 Lower


The soybeans were very strong yesterday, but the November contract essentially ran into trend line resistance, turned around, and move lower overnight. A frost/freeze next week could have a major impact on the soybean market, but traders are going to want to see the forecasts stay consistently cold before chasing the market higher.

Live Cattle
Trend
Short Term: Down
Long Term: Down
Seasonal: Up
Opening Calls: 10-20 Higher


Live cattle futures finished higher across the board on Tuesday, with improved cutout values and new highs for the year in equity markets supporting the move. Overnight saw a continuation of yesterday’s activity, with equities and live cattle posting additional gains. A rise of nearly 4300 contracts in open interest in the live cattle suggests new buying, not short covering entering the market. We expect the new buyers to continue to enter the market as ready cattle numbers tighten into the fall time period.

Feeder Cattle
Trends
Short Term: Down
Long Term: Down
Seasonal: Down
Opening Call: Mixed


Feeder cattle futures fell under the pressure of nearly limit gains in the corn market on Tuesday. Trade quieted in the overnight session, with corn posting 3 cent losses and feeders trading narrowly mixed. This Friday’s cattle on feed report is expected to get back to some modest placement numbers, that should support feeders if corn doesn’t extend yesterday’s sharp move higher. Look for more two sided trade unless corn makes a substantial move in one direction or the other.