by Duane Lowry
Monday, September 17, 2012
SUNRISE OUTLOOK OVERVIEW:
*At 7:01 am> Grain/Soy Snapshots: Corn= 14 1/2 lower, Wheat= 13 1/4 lower, Soybeans= 31 3/4 lower.
Day Session Expectations vs Night Session Tone:
Dec Corn: Support= $7.62-65, Resistance= $7.75-80
*Some recovery may be possible, but selling interest is building above the market.
Nov Soybeans: Support= $16.95, Resistance= $17.25-30
*Selling interest is building above the market.
Dec Wheat: Support= $8.75, Resistance= $9.25
*Recovery is possible.
Outside Market Influences:
At 6:59 am> Price Snapshots: Crude was down $0.29, Gold was down $1.80, Dow Index was down 31 and the US $ was up 10.
*We are poised for trend changes.
Weather provides favorable Midwest harvest conditions for the Midwest during the next two weeks. Moisture will impact the Delta through the Southeast this week. There are no bullish global weather storylines impacting US ag futures at this time. There have been and will be daily attempts to find some region/area of concern, but the market has not been and likely won't be trading day-to-day weather themes in any clear connection to day-to-day price action during the next several weeks.
Wheat has little for news, but may still have some short-covering agendas that could help to recovery part of the overnight decline before the day is over. .
Corn disappointed traders with the overnight losses. New news is limited. Still seems to be some better than expected yield themes developing. Charts are threatening. Technical conditions will encourage selling interest to build above the market. Overall conditions warn of additional liquidation pressures ahead.
Soybeans shocked traders with the overnight losses, which took prices more than 60 cents off Wednesday's highs. News is limited, but word that the US is initiating a new trade dispute against China doesn't help the tone. The trade is still waiting for more yield reports. Charts offer warnings of much vulnerability to liquidation pressures than trade rhetoric is willing to consider. Technical conditions will encourage selling interest to build above the market.
In summary, liquidation pressures are unfolding. Traders are beginning to recognize this unfolding and beginning to fear additional downside risk. Choppy action is possible, but selling interest will be building above the market from multiple sectors of the trade.
Barge Values: September= +28 Z
CZ: Support= 7.35-50, Resistance= 7.80-95
**PROFILE: Dec Corn> Selling interest will build on short-term bounce efforts into $7.80-95 zone. Overall conditions point to price erosion during the next few/several weeks.
Barge Values: September= +65 X
SX: Support= 16.65, Resistance= 17.50-65
SMZ: Support= 480, Resistance= 530
BOZ: Support= 54.00, Resistance= 57.50-58.00
**PROFILE: Nov Soybeans> IN SUMMARY, overall conditions offer compelling warnings of a major liquidation break ahead. Short-term strength offers selling opportunities.
Barge SRW Values: September= +40 Z
WZ: Support= 8.90, Resistance= 9.30
**PROFILE: Chicago December Wheat>.
GLOBAL HIGHLIGHTS & HEADLINES: The US ambassador to the UN says there is no daylight between the US and Israel when it comes to stopping Iran from developing a nuclear weapon. She also says that US-Israeli intelligence indicates that the two nations have considerable time before that happens. However, Israel's Prime Minister Netanyahu was on two US Sunday news programs making a strong case to US voters to choose a US president that will be willing to choose a red line approach to Iran, implying that the Israeli Prime Ministers wants a quicker US decision to militarily intervene in Iran to stop their nuclear program advancements. The Obama administration will announce new trade enforcement action against China through the WTO due to China's illegal subsidizing of auto parts, which puts US auto parts manufacturers at a disadvantage and encourages US companies to outsource jobs and production activities to China.
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.