FIRST LOOK, by Duane Lowry
Friday, October 5, 2012
SUNRISE OUTLOOK OVERVIEW:
*At 5:51 am> Grain/Soy Snapshots: Corn= 2 3/4 lower, Wheat= 2 3/4 lower, Soybeans= 3/4 higher.
*Where are we for the WEEK? Dec Wheat= down 33 1/4 cents; Dec Corn= up 3/4 cent; Nov Soybeans= down 49 1/2 cents; Dec Soymeal= down $18.00; Dec Soyoil= down 122 points; Crude Oil= down $0.48; US $ Index= down 58; Gold= up $22.60; Dow Index= up 143.
*Informa will release their latest US production estimates this morning.
Day Session Expectations vs Night Session Tone:
Dec Corn: Support= $7.35-40, Resistance= $7.60
*We may need to have more tests of support under $7.50 during the next few/several days, possibly probing into the $7.35-40 zone?
Nov Soybeans: Support= $15.10-20, Resistance= $15.60
*We are in the final stages of defining a major seasonal bottom, but this may include a test/probe of recent lows.
Dec Wheat: Support= $8.50, Resistance= $9.00
*Mixed indicators, but we seem vulnerable to probing recent lows during the next several days.
Outside Market Influences:
At 5:51 am> Price Snapshots: Crude was down $0.93, Gold was down $5.00, Dow Index was up 18 and the US $ was up 3.
*The US Dollar is positioning for a notable upside push in the weeks ahead.
Weather is similar to yesterday and offers little market influence.
Wheat has little for news. Some will point to improving Southern Plains moisture prospects in the 6-15 day window. Short-term technical conditions offer mixed signals, with a bias leaning towards another test/probe of recent lows. Overall conditions that have row-crops in the process of defining major bottoms, with inter-market spreads that will find it very difficult to build independently trending lower price patterns in wheat, makes it extremely difficult to embrace any downside probe here as part of a new downtrend at this time. We seem vulnerable to weakness during the next several days and likely a probe of recent lows. Such a move should be seen as a bear trap.
Corn traders await Informa's latest projections set to be released at 10:30 this morning. Short-term technical conditions will encourage layers of support and buying interest to build under the market, limiting the ability of any weakness to develop sustainable downside momentum. Search short-term weakness for longer-term buying opportunities.
Soybeans traders expect bearish slants to Informa's production estimates. While we are in the process of defining major seasonal bottoms, short-term technical conditions remain vulnerable to additional tests/probes of this week's lows. Such weakness events should be searched for longer-term buying opportunities. From a seasonal low, likely to be established near/just below this week's lows, upside potential will be approximately $3.
In summary, there remains little for new storylines, but we await Informa's production estimates this morning and USDA's latest assessment next week. Technical conditions suggest viewing short-term weakness from the context of defining major longer-term seasonal bottoms and searching for buying opportunities.
Barge Values: October= +64 Z
CZ: Support= 7.35-45, Resistance= 7.60-65
**PROFILE: Dec Corn> Layers of support will continue to surface on probes below $7.50. Short-term weakness during the next several days should be searched for longer-term buying opportunities.
Barge Values: October= +75 X
SX: Support= 14.90-15.10, Resistance= 15.60-65
SMZ: Support= 450-55, Resistance= 475
BOZ: Support= 49.50-50.50, Resistance= 53.00
**PROFILE: Nov Soybeans> We are likely in the final stages of defining the seasonal bottoms. This process can lead to a jab below this week's lows. Any test/probe of this week's lows need to be searched for longer-term buying opportunities. IN SUMMARY, short-term indicators suggest we may have more time to finalize season bottoms and the next several days may lead to a test/probe of this week's lows. However, such weakness should be seen as providing longer-term buying opportunities.
Barge SRW Values: October= +58 Z
WZ: Support= 8.40-45, Resistance= 9.00-9.10
**PROFILE: Chicago December Wheat> Mixed short-term signals. Probes below recent lows should not be embraced as trend-establishing moves.
GLOBAL HIGHLIGHTS & HEADLINES: .
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.