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Midday Update



Midday Update

·         This morning’s monthly jobs report indicated that the unemployment rate rose to 5.7%, up from 5.6% the previous month as more people returned to looking for work. Furthermore, the economy added 257K jobs in January, above expectations of 230K, with the previous two months revised upward as well.

·         The dollar surged to more than 1,100 point gains following the data release on the belief that it puts more pressure on the Fed to raise interest rates later this year.

·         The surge in the dollar led to active selling of many commodities, including grain and oilseeds, that traders believe will see their competitiveness hurt by the stronger greenback.

·         Crude oil rallied on ideas that a healthier economy will spur more demand.

·         The meat complex also benefited from perceptions of a healthier economy.

·         Corn futures are down 3 cents on the above selling on a strong dollar, but are finding support at the 100-day moving average near $3.80 so far.

·         Soymeal is down $2.10 per ton and soybeans are down 7 on a strong dollar and advancing South American harvest amid generally favorable weather.

·         Wheat futures are mixed in Chicago, down 2 in Kansas City and down 6 in Minneapolis. Support continues to come from expectations/hopes that Egypt will use a $100 million grant to buy U.S. wheat.

·         Feeder cattle are up $3.25 to $3.5 on a corrective bounce and economic optimism.

·         Live cattle are up $2.00 to $2.80 on ideas that the market was at too big of a discount to the cash, with the feeder cattle market providing support. Boxed beef movement this morning was weak, with prices lower as well.

·         Lean hog futures were mostly $2.75 to $3.00 higher on a bounce. Product prices were modestly firmer on routine movement.


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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Arlan Suderman | Senior Market Analyst
WATER STREET ADVISORY® | www.waterstreet.org
(316) 729-4599 | asuderman@waterstreet.org

Past performance is not indicative of future results. The information contained in this report is intended for informational purposes only and is the opinion of the writer and may change at any time. This information was compiled from sources believed to be reliable but accuracy cannot be and is not guaranteed. There is no warranty, expressed or implied, in regards to this information for any particular purpose. There is SIGNIFICANT RISK involved in trading futures and or options on futures and may not be suitable for all investors. Investors should consider these RISKS and evaluate their suitability based on their financial conditions. No one should ever consider trading futures or options on futures with anything other than RISK CAPITAL. This information is provided freely and is NOT in the capacity of a trading advisor. NO LIABILITY on the part of the author exists for any trading loss you may incur in the use of this information. Information provided is not to be construed as an offer to sell or solicitation to buy any commodity or security named herein.

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