CORN
This morning the corn is making a run at last week's low. Friday, the December corn failed at the 50 day moving average resistance, which was a big disappointment to bullish traders, along with the fact that the market really didn't gain much following the QE3 announcement. There is a lot of talk of farmer selling and harvest pressure, which isn't helping matters at this point. Analysts say critical support is now at the $7.59 level.
WHEAT
So far the wheat has not been able to build on last week's impressive gains due because it is being held back by the corn and beans. The charts still look fine even with the overnight pressure and it still looks like the December KW is headed higher. The $9.50 area will act as strong resistance, but a close above that level will add fuel to the bullish fire.
SOYBEANS
Soybeans are the downside leader and like the corn are making a run for last week's lows. This break will likely result in fresh end user demand according to analysts and one should look for the $17.00 area to hold as support again in the November contract. Analysts anticipate tight supplies through the rest of the crop year.
LIVE CATTLE
Live Cattle futures closed mixed on Friday, with the front months lower and deferred contracts higher. For the week, October finished up .45 while cash moved $2-$4 better. Outside markets look somewhat negative this morning, with a higher Dollar and softer equities. Packers remain short bought, with most of the September contracts already claimed. The recent weakness in the Dollar should continue to support a solid export pace.
FEEDER CATTLE
Feeder Cattle futures were moderately lower on Friday and off .55 for the week in the October. Weakness in overnight corn values should support the feeders on the open. Unlike the fats,open interest in the feeders in recent trade has not been growing. Channel support and resistance in the October feeders ranges from 143.50 to 148.80.
CRUDE OIL
October crude oil prices traded lower during the overnight and initial morning hours, under modest pressure from slowing economic growth concerns in China, as well as profit-taking after recent gains. Some traders also pointed to a slight pullback in risk-taking sentiment as a force weighing on crude oil. Meanwhile, some of the support in the crude oil market comes from growing tensions in the Middle East, with protests at the Afghan capital, as well as a growing urgency from Israel's Prime Minister Netanyahu calling for "red line" against Iran's nuclear development program. The Commitments of Traders Futures and Options report as of September 11th showed non-commercial traders were net long 305,623 contracts, an increase of 15,098. Non-commercial and nonreportable traders combined held a net long position of 313,582 contracts, for an increase of 13,822 in their net long positioning. It is possible that net long positioning could be understated as crude oil prices rallied nearly $2.00 since the report window closed and open interest was up around 30,000 contracts.
There is substantial risk of loss to futures and options trading. Past performance is not indicative of future results.
By Donna Hughes
Lone Star Portfolio Advisors, Inc. was founded by Donna Hughes. Donna began her career in the industry in 1978 after graduating High School as a member of the Chicago Mercantile Exchange’s Inspection and Delivery Department where she was responsible for scheduling and facilitating the USDA grading and delivery for various Exchange Commodities. After 1 ½ years, she was offered a position working with George Segal, a prominent hedger in the Pork Belly market. It was through this relationship that she was mentored and taught the hedging process by working with Mr. Segal as well as other leaders of the Pork Industry. In 2004, Donna moved to Texas where her skills in the industry were utilized to help individual and corporate producers with their Risk Management Goals. Her Daily Market Commentaries are heard on the AllAgNews.com Radio Network broadcasting throughout Texas. She also contributes to magazines and periodicals including PetroEvents and Ag Monthly.
Donna created Lone Star and implemented strategic relationships with Daniels Trading and R.J. O’Brien leveraging their services to enable Lone Star to Build Lasting Relationships Thru Information, Execution and Research.
