Sep17

Schwieterman: Weakness in overnight corn values should support the feeders

on September 17th, 2012 at 9:18 am
Posted In: A, Beef Production, Cattle, Crop Production, Market Information

Corn                                      Estimated Fund Position

Trends

Short Term: Down                Net Long Futures and Options: 232873

Long Term: Down                Change: +8000

Overnight Trade: Z -16 @7:30 AM

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 lots of talk of farmer selling and harvest pressure, which isn’t helping matters either. Critical support is not at $7.59.
Wheat                                   Estimated Fund Position

Trends

Short Term: Up                     Net Long Futures and Options: 19664

Long Term: Up                     Change: +6000

Overnight Trade: Chicago: Z -18 KC: Z-17 @7:30 AM

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                             Estimated Fund Position
Trends

Short Term: Down              Net Long Futures and Options: 205769

Long Term: Up                   Change: -5000

Overnight Trade: X -38 @7:30 AM

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 and one should look for the $17.00 area to hold as support again in the November contract. Due to the tight supplies we will be facing through the rest of the crop year, it still looks wise to buy breaks.

Live Cattle

Trend

Short Term: Up

Long Term: Up

Opening Calls: Mixed

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

Trends

Short Term: Up

Long Term: Up

Opening Call: Mixed

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. We continue to look to trade the extremes inside the channel.

Source: Schwieterman Marketing, LLC, www.upthelimit.com , 620-275-4133

└ Tags: , , , , ,