Commodities Retrace Some of Yesterday’s Losses
Nov 22, 2011
Good Morning! Paul Georgy with early morning comments for November 22, 2011 at 5:15 am. Grain markets rebound slightly after several days of lower trade. Confidence and demand are the keys to market direction this week. With the new leadership in Spain, traders are concerned about unveiling more debt than was previously reported. The selling on Monday seems to have been prompted by European fund liquidation as they are reducing risk and repatriating their money. Selling by US funds was driven due to technical and momentum signals triggered by macro uncertainty. We need to see some business by China to provide fundamental support. It seems unlikely as they are harvesting a record corn crop and all immediate needs have been met. Brazil should get some rain this week. Choice beef values were up 1.26 on Monday while select was down .47, pork cutout values were down .27. Markets are expected to be very choppy with more talk about the famous Thanksgiving seasonal which has beans rallying the day before and the day after. Markets are open regular hours on Wednesday, closed Thursday and close early on Friday. Contact your broker for complete details. Happy Thanksgiving to All!
Markets as of 5:15AM
Corn: 2 to 3 higher Beans: 3 to 5 higher Wheat: 2 to 4 higher
Live Cattle: 0to 10 higher Lean Hogs: 10 lower to 10 higher
Dollar: .20 lower Crude: 1.29 higher Gold: 19.40 higher
Allendale Advanced Charts
Cattle dipped below the long-term uptrend on Monday but then managed to close above last Friday’s low of 121.45. This may have been a prime buying opportunity. If further strength is seen today, we must keep our eye on some resistance at the previous double bottom at 122.12.
Nelson Notes from the desk of Rich Nelson
The first half of November saw below normal precip for Brazil. That will lead some to suggest it is the start of La Nina dryness. Our favored meteorologist, Drew Lerner, estimates only peripheral dryness will be seen from the second half of December into January. Yields will be average in South America as areas with good precip offsetting those few areas which are dry.
There is a significant risk of loss when trading futures and options contracts. This information is not to be construed as an offer to sell or a solicitation or an offer to buy the commodities herein named, and each investor should consider the appropriateness of trading on this information, based on their objectives. The factual information of this report has been obtained from sources believed to be reliable, but is not necessarily all-inclusive and is not guaranteed as to accuracy. Past performance is not indicative of future results.