by Duane Lowry
Friday, March 4, 2016
Corn only briefly traded into negative territory, setting up 1 3/4 cents, but 2 1/2 cents off the day’s high. News remains limited/stale. Broad commodity short-covering sentiment helped to provide support, along with tech-based buying interest. Expect the tech-based traders to be willing to increase their interest in ownership on relatively minor weakness from today’s settlement. Overall conditions remain well-poised to produce price strengthening in the weeks ahead.
Soybeans pushed higher again today, settling up 14 3/4 cents. Today’s settlement was 22 1/2 cents off this week’s lows and the highest settlement since Feb 22. News remains stale. Trader sentiment remains bearish. To offer perspective, today’s settlement is just 12 cents below the highest values seen this calendar year. So, you can see that it really doesn’t take that much strength to begin triggering more aggressive short-covering activities. Technical conditions are supportive and will encourage buying interest to surface on weakness next week. Overall conditions continue to suggest limited downside potential and much greater upside potential than trade rhetoric suggests.
Wheat traded both sides today, following yesterday’s substantial gains, settling up 1 cent. News is limited. Technical conditions will encourage buying interest to surface near/just below today’s lows. Overall conditions point to notable price recovery activity in the weeks ahead.
In summary, today’s price action will help to awaken grain market followers, even though most will remain bearish and believe little upside potential can occur. Tech-based traders will be more enthused to consider trading these markets from the long side on minor weakness from today’s settlement. Overall conditions suggest significant upside potential exists during the next few months. At 1:15: Crude= up $1.17, Gold= up $7.60, Dow Index= up 81 and the US Dollar= down 23, May Corn up 1 3/4 cents, May Soybeans up 14 3/4 cents and May Wheat up 1 cent.
WEATHER: Midday weather forecasts offered little influence to price action and were largely unchanged from this morning’s discussion.
*March 9, 11:00 am, USDA monthly S&D report.
Sunday night's grain trade outlook: Traders will experience a bit of an awakening towards the grain market following this week’s price action. Most will see limited upside potential or offer mostly a shrug of the shoulder. However, tech-based traders will begin more earnestly to search weakness with an eye for a buying opportunity. Initially, we probably can see some weakness early next week, but overall, we remain poised for notable corrective strength potential in the weeks to come, with this week’s trade appearing to signal a beginning of that process.
Humor/Quote of the Day:
If you say you’re cooler than me…Does that make me hotter than you?
Raisin cookies that look like chocolate chip cookies are the main reason I have trust issues.
This newsletter is prepared from information believed to be reliable. Early Market News, Inc. does not guarantee that such information is accurate or complete and it should not be relied upon as such. Opinions expressed are subject to change without notice.