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Closing Comments

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Closing Comments

Corn extended yesterday’s short-covering rally but gave up some of the mid-day gains before finishing for the weekend. Export sales this week arrived at the low end of the trade guess. In today’s trade, funds were estimated as buyers of some 16,000 contracts of corn. CFTC data showed funds covered some 31,885 contracts as of Tuesday – leaving them net short -130,973. Corn is still in ‘higher high’ mode on the chart and will begin encountering resistance in the 3.60-3.75 area. Dec closed today at 3.54 ½ with the 200 day MA at 3.73.

 

Soybeans traded back to the top of their recent trading range on supportive export business and sympathetic buying with corn and wheat, but gave up some of the gains before the finish. Soy Oil helped out by putting in the highest close since August 23rd. Weekly export sales came in above trade expectations. NOPA report will be out Monday. CFTC data showed Managed Money added about 7,900 to their long position. Charts are still in consolidation mode, looking for more direction from soy meal.

 

Winter Wheat contracts gained again today but Minneapolis couldn’t hold early gains, closing off 3 ½ today. Wheat export sales came in the middle of trade expectations. In the Chicago Dec contract, look for resistance next week to be today’s high of 4.21 with solid resistance around 4.40.

 

Cattle futures found some short covering and technical buying to finish the week after reaching six year lows on Thursday. Cash trade was disappointing, mostly at $97-98 vs last week at $101-103. Chartist are hoping the weekly chart finally has completed the fifth wave of a move that began the fall of 2014 – action the next couple weeks will be watched closely.

 

Hog futures gave up their recent gains today on profit taking and continued anxiety over big supplies. CME lean hog index is trading at 52.76.  Packer margins are estimated near $50 per head. If Dec can’t hold the $40-42 area next week, technicians will begin opening the door for targets toward $34 and $30.

Closing Market Snapshot

 

All opinions expressed in this commentary are solely those of Water Street Advisory. This data and these comments are provided for information purposes only and are not intended to be used for specific trading strategies. Although all information is believed to be reliable, we cannot guarantee its accuracy or completeness. There is significant risk of loss involved in commodity futures and options trading and may not be suitable for all investors.

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