February 2012 Archive for Midday Futures

All Agriculture markets are higher.

Soybeans are leading the way again this morning as they continue to make new highs.  Soybeans are attempting to close higher on the day for the 8th consecutive day. There is an ongoing battle between fundamental and technical factors and fundamentals say the market should go higher while technicals insist the market is overbought.  Recent gains are being offset by producer selling at these levels. 

Old crop corn futures are 3c higher in early trade.  Traders note that the market is following soybeans, but is being offset by farmer selling as the basis has improved.  A stronger dollar today is also limiting a corn rally.  Crude oil is also a major factor in the price of corn as ethanol is the #1 use for corn.  Analyst say that as long as Crude is above $105/barrel corn will be bullish.  Crude oil is currently down .80 at $105.75. 

Outside markets have been extremely volatile today.  Gold Futures were down as much as $80/oz and silver was down $3.35/oz at the session lows.  The US Dollar is up .33 at 78.63. 

Feeder Cattle and live cattle are stronger this morning.  There was light trade yesterday afternoon at $128 which caused cattle to rebound after yesterday's selloff.

Call me with questions or comments (877) 431-9805.

Justin R. Lewis, MBA

Follow me on Twitter: @jlewis58

There is a significant risk of loss when trading futures & options contracts.  Investors should carefully consider whether trading futures is appropriate based on their own financial situation.

Soybeans are leading the way this morning on short covering and fund buying.  South American soybean production estimates continue to decline.  The US Dollar is also weak today, improving future exporting opportunities.  The soybean market is extremely overbought and could potentially stop additional rallying in the near future.  SH2 13.03 +9 1/4 SX2 $12.86 +4 3/4

Corn futures are following the soybeans higher this morning despite increased planted acreage estimates.  The weakened dollar also improves export opportunities.  Traders are also crediting the rally to higher outside markets, including gold and silver.  CH2 $6.50 +5 1/2 CU2 $5.94 +6.0

Wheat is up on short covering by funds and small specs.  They are following soybeans despite ideas that wheat is abundant around the world.  Most traders believe the wheat market will have a hard time continuing the move higher. 

Feeder Cattle futures are down .40 to .80 with continued follow through selling from yesterday.  The market has been overbought for some time and could sell off significantly based on retracement levels.  We have seen a lot of option spreads placed at these levels.  (buying puts/selling calls)

Call me with questions or comments (877) 431-9805.

Justin R. Lewis, MBA

Follow me on Twitter: @jlewis58

There is a significant risk of loss when trading futures & options contracts.  Investors should carefully consider whether trading futures is appropriate based on their own financial situation.

Grains have rebounded after a weak open this morning.

Soybeans have rallied to their highest price since September 27th, caused by fund buying and continued fears that South America's pruduction will fall short of expectations.  March Chicago Wheat has rallied 12c off its lows to $6.42.  Traders believed wheat would be under pressure today due to wetter forecast for much of the midwest and continued fund selling.  Old crop corn is up 2 cents and 10 cents off the lows, while new crop corn is down 1 cent.  New crop corn is thought to be under pressure due to the estimated 94 million acres and a baseline yield of 164 bushels per acre.

Feeder cattle are 70-95 lower this morning after a bullish cattle on feed report Friday afternoon.  Traders are saying this is a buy the rumor, sell the fact situation.  Live cattle are up .22 in Feb, but down in the back months.  Feb Live Cattle futures expire Wednesday.

Happy Trading,

Justin Lewis, M.B.A.

(877) 431-9805