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The Allendale Wake-Up Call

RSS By: Paul Georgy,

Paul Georgy serves as president/CEO of Allendale, Inc., a worldwide agricultural advisory and research firm that provides agricultural commodity price research and risk management alternatives for producers, major food companies, international corporations, foreign governments, and major news vendors.

Wheat Breaks Chart Resistance

May 05, 2014

Good Morning! Paul Georgy with early morning comments for May 5, 2014 at 4:30 am.  

Grain futures are mixed as wheat breaks into new highs for the move.

Weather, chart signals, Ukraine and government reports are all influencing trader’s bias to start the week.

The forecast is much like it was on Friday which should allow for farmers to put the tractors and planters into action across much of the Midwest. Rain in the hard red wheat areas was light over the weekend and no drought busting moisture is in the forecast. How long can wheat hold on waiting for some moisture?

The sharply higher opening last night took out major resistance in the July contract at 7.25. Old resistance now becomes support.

The Ukraine army is trying to defend local communities against the pro-Russian protestors. Things heated up this past weekend in the east and southeastern portions of Ukraine as both sides had reported casualties. Putin has not moved his troops into Ukraine as far as we know.

The USDA will report planting progress this afternoon at 3:00 pm. Range of estimates are wide with a 25 to 35% corn planted. Most estimates are in that 26 to 30% area. The 5 year average is 42%.

The CFTC Commitment of Traders report showed that the week ending April 29 managed money funds added 27,756 corn contracts to their already long position. They were net buyers in soybeans of 3,725 and net buyers in wheat of 15,000 contracts.

The USDA will be releasing their May Supply and Demand estimates on Friday May 9 at 11:00 AM. The report is expected to provide something for the bulls and the bears. We will give more details as we get closer.

Live cattle traded higher on Friday with the South up 1.00 and the North plus 3.00 on dressed basis. However the cutout values were lower with choice down 1.96 and select down 3.51. The CME Feeder Index is 179.56. Pork cutout was up .19. The weak close in futures on Friday would suggest a lower start when markets open this morning.

Markets as of 4:30 AM        

  • Jul Corn    + 3/4
  • Jul Beans   – 1/4
  • Jul Wheat   +12
  • Jun Cattle  Steady-Lower
  • Jun Hogs    Steady-Lower
  • Jun Dlr     -.02
  • Jun S&P     -7.75
  • Jun Crude   +.59
  • Jun Gold    +10.10

 Chart of the Day

daily chart

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