by Duane Lowry
Friday, February 10, 2012
Corn= lower, Wheat= lower, Soybeans= lower.
*At 6:49 am> Night session results: Corn= 2 3/4 lower, Wheat= 8 lower, Soybeans= 9 1/4 lower.
*Where are we for the WEEK? March Wheat= down 14 3/4 cents; March Corn= down 7 1/2 cents; March Soybeans= down 5 cents; March Soymeal= down $7.60; March Soyoil= up 89 points; Crude Oil= up $2.00; US $ Index= down 40 points; Gold= up $0.9.70; Dow Index= up 49.
Weather offers favorable/acceptable conditions for Brazil and Argentina and no market influence.
Wheat will start lower on overnight weakness. Yesterday's reports didn't offer anything to offset a bearish fundamental foundation and disappointment has led to a return of selling activity. Short-term recovery efforts will be of limited duration and scope. We are poised for a trending lower pattern to evolve during the next several weeks/few months that makes an assault on the December lows.
Corn will start lower on overnight weakness. Traders were very disappointed in the lack of a bullish storyline from yesterday's reports and extremely discouraged by yesterday's price action. This has quickly caused increased selling interest from multiple sectors of the trade to build above the market. Short-term bounce attempts may prove to be short-lived. Expect the trade to focus on longer-term expectations of building supplies and ideas old-crop supplies will be adequate. It will be interesting to see whether weak price action will bring more attention to the ethanol industry's problems and the possibility of reduced demand projections there. It is a very real possibility that this market is able to maintain a weak bias until/unless a planting/growing season weather problem develops. Downside remains very significant and much more than current rhetoric suggests. Short-term upside probes above yesterday's close needs to be searched for selling opportunities.
Soybeans will start lower on overnight weakness. Outside markets helped to fuel this weakness, but technical conditions and fundamental disappointments were the first and primary motivators. Selling interest will build above the market and limit recovery efforts. Overall conditions warn of declining price trends ahead and much more downside risk than popular rhetoric implies.
In summary, markets appear to have confirmed the end of a notable topping process. Selling interest will build above the market from multiple sectors of the trade and limit the scope/duration of any short-term upside attempts. Maybe we will get some recovery bounce attempts early next week, but today feels heavy. Downside risk is significant and we won't likely return to recent levels until/unless a spring/summer weather storyline develops. As I have said before, 2012 is a much different year than recent years. Hoping for prices to levitate at high levels and believing they will always offer another selling opportunity could prove to be a very disappointing marketing strategy, especially with remaining old-crop inventory. At 6:47 this morning: Crude was down $1.28, Gold was down $24.60, Dow Index was down 87 and the US $ was up 48.
Barge Values: Feb= +70 H
CH: Support= 5.90, Resistance= 6.38-44
**PROFILE: March Corn> An extremely weak performance yesterday. Charts are rolling over. The topping process appears over. Overall conditions warn of much more downside risk than current market rhetoric is will