CORN
The corn managed to hold gains yesterday and saw some follow through buying overnight. The market is considered a bit oversold, so one would think some corrective activity would be warranted. Analysts won't get excited about the corn until they see the December contract close above the 40 day moving average at the $7.54....which by the way has been acting as resistance for much of October. Potential new buyers will be looking for mention of better export demand.
WHEAT
Follow through strength overnight for the wheat market after bouncing off of yesterday's lows. We are basically consolidating in the middle of the trading range. We are still waiting on any "new" news. Traders will need to see more than just one week of decent export sales in order to be convinced that demand is improving.
SOYBEANS
Today's action could be pivotal for the soybeans. A strong close today would confirm that this correction is over and the market is ready to move higher....a new low for the move would then indicate that the January soybeans would be headed to $14.85. Demand is still strong and it still looks likely that we will use all that we produce...traders are still cautious of a higher production estimate in next week's report. For today, analysts say look for buying to accelerate if we see a move through $15.51 in the January contract.
LIVE CATTLE
Moderate to strong gains for Live Cattle futures in yesterday's session, as southern cash trade surprisingly got rolling at steady to $1.00 lower than a week ago. The October contract will expire today, leaving December as the lead month. Northern cash has yet to develop, with asking prices of $198-$200 in the beef. Cutouts were significantly higher on Tuesday and the Dollar lower once again. US equity markets are open for the first time this week and are trading moderately higher in early morning futures.
FEEDER CATTLE
Feeder Cattle futures posted triple digit gains on Tuesday, as new buyers stepped into the market, even though corn was firmer for the day. Overnight prices have softened in the face of another 4-5 cent gain in corn and slightly softer live cattle trade. The lack of moisture in wheat grazing regions could force more calves into feedlots over the next month or so according to analysts. Analysts peg key resistance for the November contract near the 100 day moving average of 148.00.
CRUDE OIL
December crude oil prices trended higher during the initial morning hours, supported by gains in global equity markets and weakness in the US dollar. Some traders also indicated that US refinery demand for crude oil could come back on line sooner than expected, and that seemed to offer an added measure of support this morning. The crude oil market showed a measure of strength with its ability to discount private industry data late Tuesday that showed a larger than expected build in inventories last week. The weekly EIA report has been delayed due to Hurricane Sandy.
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.
