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Corn – May ’11 hasn’t looked back since last Thursday’s stocks report. I have to say I was looking for a pull back today but the market just laughed at me. There was good volume again today as the May ’11 futures closed up $.24 1/4 on the day. I think one of these days we should see an intra-day pull back but by the looks of it any pull back would be bought. $8.00 futures looks to be the next likely target for May ’11 corn.
Bottom Line – I’m looking for an early low and late high tomorrow.
Meal – I have to say I’m surprised at the action we’ve had in May ’11 meal. We are still holding the support levels of $356.30 but if the market doesn’t hold support at $352.30 then we possibly drop back to $339.40. Like corn, I think any breaks in the meal market will be bought.
Bottom Line – Based on today’s action I’m looking for an early low tomorrow.
Hogs – June ’11 hogs closed higher today after starting out softer. The cash market didn’t do much today but didn’t fall out of bed either. The cutout was $.18 higher which isn’t any big deal either other than the fact it wasn’t lower on the day. Longer-term thought for June ’11 hogs is still higher even though we had a warning sign on our weekly chart last week. I will monitor this sign to see if it may lead somewhere but after today’s rally on the close I think it is evident that hogs are firm.
Don’t get complacent, make sure you make business decisions! If you sell hogs, buy your corn and meal. Don’t mess around with this volatility in the market. If you have a contracted in price for your pigs at a reasonable price you should be making excellent profits right now even with corn and meal at current levels. The stocks report last week is looking to take prices high enough to ration usage so to me that means the profit margin in hogs probably will not grow as fast in the front months as it will in the back months.
Bottom Line – I’m looking for an early high in the JUNE ’11 hog contract for tomorrow.
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