Grains Continue Higher
Feb 28, 2012
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
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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.