FIRST LOOK, by Duane Lowry
Tuesday, December 27, 2016
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SUNRISE OUTLOOK OVERVIEW:
At 6:55 am> Grain/Soy Snapshots: Corn= 3 1/2 higher, Wheat= 5 3/4 higher, Soybeans= 11 1/2 higher.
Day Session Expectations vs Night Session Tone:
March Corn: Support= $3.40-47, Resistance= $3.65.
*Longer-term and short-term technical support exists at current levels. Further price erosion potential should be seen as minimal. Upside potential is greater than current sentiment suggests. Current levels offer ownership opportunities.
March Soybeans: Support= $9.95-99, Resistance= $10.45.
*Short-term technical conditions can produce stabilization around last week’s lows and recovery activities during the next few weeks. I have no interest in any bearish stance, despite bearish fundamental profiles.
March Wheat: Support= $3.95-97, Resistance= $4.35.
*Short and longer-term technical support exists around last week’s lows. Upside potential during the next few months is significant. Search for ownership opportunities.
Outside Market Influences:
At 6:54 am> Price Snapshots: Crude was up $0.16, Gold up $9.80, Dow Index was up 2 and the US $ Index was up 12.
*Crude oil will struggle to build any upside momentum above last week’s highs. Short-term technical conditions are poised for a downside turn to soon develop and build downside momentum. Fundamental justification for building upside momentum seems difficult to find/embrace. This market has much more downside potential than rhetoric of the past few weeks have suggested. Search for selling opportunities.
*Gold has achieved price levels capable of producing stabilizing price action. I have no interest in any bearish stance at this time. I am unsure about a longer-term stance.
*US Dollar Index has achieved some longer-term upside targets. Some pausing/corrective action is possible during the next several days/few weeks. Overall conditions remain capable of keeping the US Dollar well supported in the weeks/months ahead.
*Dow Index is in a bubble. This process will create a major and long-lasting top. Short-term technical conditions are poised for a downside turn and capable of building downside momentum. Charts appear very vulnerable to downside risks, with upside potential limited. Current levels offer selling opportunities.
Weather offers favorable South American conditions.
Wheat fundamental storylines are bearish, fully known and fully discounted. News is stale. The unknown fundamental factors are of far more interest to me at this time. I see merit in wanting to own the unknown. Short and longer-term technical support exists at current levels. Upside potential is easily 50 cents from here. Downside risk seems manageable. Current values offer ownership opportunities. I am only interested in trading this market from the long side at this time.
Corn news is stale. Short and longer-term technical support exists at current values. Users have ample reasons to seek ownership. Producers have little incentive to make sales. I have no interest in any bearish stance. Current values offer ownership opportunities. Upside potential could be 30+ cents from current values.
Soybeans performed well overnight, respecting supportive technical conditions after recent weakness. News is limited. I have no interest in any bearish stance at this time, despite bearish fundamental storylines. Search for ownership opportunities.
In summary, wheat and corn have technical conditions that encourage a bullish stance. Wheat should find inter-market support and could be setting the stage for a significant upside run during the next 60-90 days. Soybeans have bearish fundamental profiles, but they are the same profiles that existed when soybeans bottomed ahead of harvest and proceeded to rally more than $1.25. I have no interest in any bearish stance and I am only interested in finding ownership opportunities. Better price levels will unfold in the weeks/months ahead.
Barge Values: Dec= +33 H
CH: Support= 3.40-47, Resistance= 3.65
**PROFILE: March Corn> Short and longer-term support exists at current levels. I have no interest in any bearish stance at this time/price zone. Current values offer ownership opportunities for users and speculators. Upside target is something into the $3.80 zone. IN SUMMARY, focus on ownership opportunities, as upside potential is greater than current/recent discouraged sentiment suggests.
Barge Values: Dec= +38 F
SH: Support= 9.95-99, Resistance= 10.45
SMH: Support= 310-13, Resistance= 330
BOH: Support= 34.50, Resistance= 37.00
**PROFILE: March Soybeans> Short and longer-term support exists around last week’s lows. Recent price weakness is likely to be recovered during the next few weeks. Search for ownership opportunities. IN SUMMARY, I have no interest in any bearish stance, despite bearish fundamental profiles. Search for ownership opportunities.
Barge SRW Values: Dec= +33 H
WH: Support= 3.95-3.97, Resistance= 4.35
**PROFILE: Chicago March Wheat> Technical conditions are capable of turning price trends to the upside from current levels. Charts offer little incentive to trade this market from the short side. Upside potential could easily be 50 cents from current levels. IN SUMMARY, search for ownership opportunities.
GLOBAL HIGHLIGHTS & HEADLINES: .
The risk of loss in trading futures and/or options is substantial. Each investor must consider whether this is a suitable investment. When trading futures and/or options, it is possible to lose more than the full value of your account.
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.
© 2016 Duane Lowry. All Rights Reserved.