by Duane Lowry
AFTERNOON GRAIN COMMENTS AND NIGHT TRADE OUTLOOK
Wednesday, June 6, 2012
Corn experienced choppy and overlapping trade, with values maintaining most of the day's gains, but these price levels were largely achieved in early daytime hours. At 1:15, Dec corn was up 8 1/2 cents. News is limited. Weather anxiety appears to be on the rise. Technical conditions will continue to encourage buying and stabilization activity on any minor probes towards recent lows. We are well poised for a notable price recovery during the next 2-3 weeks if the current weather anxieties continue.
Soybeans found more aggressive weather-related buying interest combine with firm outside market tone to produce notable strength. Yet, the day's highs were established near the 9:30 timeframe. News is limited. Technical conditions are poised to encourage buying interest to build under the market and limit scope/duration of any 1-2 day corrective setbacks. Overall technical conditions could easily help to fuel more aggressive buying energy if weather fears build, possibly sending values back to the season's high. At 1:15, November soybeans were up 19 1/2 cents.
Wheat continued to stabilize, certainly not the upside leader but no appetite to establish new shorts. New news is limited. Inter-market spreads are at levels that will make it difficult for wheat to find independent weakness, suggesting wheat should experience a consolidation period as a worst-case scenario. A corrective recovery phase is very possible during the next couple of weeks. At 1:15, July wheat was up 7 1/2 cents.
In summary, today's performance was better than I feared, but certainly not unreasonable given weather concerns and firm outside market tone, especially amid a backdrop that is well positioned for a notable price recovery phase during the next few weeks. Technical conditions will continue to provide support on any 1-2 days of weakness. The overall weather pattern seems to suggest that it is likely there will be enough US acres receiving less than desired moisture to keep a bullish storyline within reach during the next 2-3 weeks. At the time the grain settlements were being determined: Crude= up $0.65, Gold= up $4.10, Dow Index= up 194 and the US Dollar= down 53.
WEATHER: Midday forecasts were similar to this morning's discussions, offering little moisture during the next week, but potential for improved moisture in the second week of the forecast.
Wednesday night's grain trade outlook: I am not sure what to expect, but giving back part of today's gains during the next day or two seems very plausible to me. Overall, we are poised for recovering price trends during the next 2-3 weeks.
Humor/Quote of the Day:
He (Bo Jackson) hit the ball so hard, I couldn't even turn around in time to see it go over the fence.
All ballplayers want to wind up their careers with the Cubs, Giants or Yankees. They just can't help it.
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.