CORN
Pro Farmer's final numbers from the Crop Tour will be released after the close today do it wouldn't be a surprise to see some buying going into the close today in anticipation of a low production estimate. The numbers released from the Iowa and Minnesota assessments suggest that USDA will need to make small cuts in their yield estimates in those states. The big question will still be harvested acres. Yesterday's profit taking took the December corn down to the 9 day moving average and so far that area is holding on the charts. A close below that level would suggest a move down to the $7.80 area according to analysts. Analysts are looking for a test of the $8.50 level soon.
WHEAT
The December KW left a fairly ugly looking bar on the chart yesterday, but like the corn, the market is holding at the 9 day moving average. Wheat fundamentals have not improved enough to turn the wheat market into the upside leader, but at this point analysts don't anticipate a sustained price break due to the fact that it will create more demand for wheat and this is something that we probably do't need in the long run. Analysts say price breaks now will result in higher prices later.
SOYBEANS
The profit taking in the soybeans was probably the most surprising to analysts since the fundamental outlook continues to improve. None the less, we were left with an outside day down on the charts in an overbought market. That suggests further weakness, but that wouldn't be something to bet on. The market had made a decent recovery overnight and a new high today would negate the reversal lower, say analysts.
LIVE CATTLE
Live Cattle futures closed moderately higher on Thursday, with support from steady southern cash trade and a weak Dollar Pressure on equities over the past few days created some early anxiety, but the cash market's strength was enough to reject the stock weakness. Overnight, we experienced a narrow two sided trade as traders look for further direction. The market remains range bound, with chart pattern showing no real energy.
FEEDER CATTLE
Feeder Cattle futures posted impressive triple digit gains on Thursday, pushing back into the top end of the recent trading range. Weakness in corn on Thursday was the factor for the Feeder Cattle rally. Overnight corn prices were firmer, putting a little softer tone to the Feeders. Analysts look for sellers to be found in the high end of this trading range. Early placements during August are considered to be down 5-8 percent.
CRUDE OIL
October crude oil prices trended lower during the overnight and initial morning hours, registering a new four day low in the process. Ideas that global economic growth could be on a slowing track, as well as uncertainty around Euro zone meetings over another bailout installment for Greece seemed to put pressure on the crude oil market. Some traders indicated that overnight losses might have been limited as a result of unrest in Syria and the IAEA meeting over Iran's nuclear weaponry. There also appears to be a measure of support coming into the market on forecasts calling for Tropical Storm Isaac to strengthen to hurricane status next Tuesday morning, and that could compromise Gulf of Mexico operations. Data from the EIA indicates that Gulf of Mexico offshore oil production represents about 23% of total US crude production.
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.
