Profit-Taking Seen Overnight

March 19, 2012 01:35 AM

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Overnight highlights. Following are highlights of overnight trade:

Corn: 4 to 7 cents lower. Futures were unable to hold early overnight gains as profit-taking crept into the market. After extending last week's gains, May corn futures fell as buying interest dried up overnight and futures are now pivoting around support at Friday's low of $6.65 3/4. Outside markets are mixed this morning, as the U.S. dollar index is pivoting around unchanged, crude oil is weaker and gold is firmer.

Soybeans: 4 to 8 cents lower. Futures have weakened after a firmer start to overnight trade. Profit-taking set into the market after May inched to a new-for-the-move high. The contract is overbought according to the 9-day Relative Strength Index, so without fresh positive demand news, soybeans are vulnerable to a setback. Pressure, however, should be limited by ongoing dryness in southern Brazil, as that region of the country missed out on weekend rains.

Wheat: 7 to 8 cents lower. Futures weakened overnight as neighboring pits faced profit-taking pressure. There's little fresh news for the market to digest this morning and without help of outside markets, wheat is vulnerable to a setback. Traders remain concerned about the HRW wheat crop coming out of dormancy early, as it raises precip needs, but overall, plentiful global supplies have kept wheat in a follower's role.

Live cattle: Mixed. Futures are expected to be mixed this morning amid spreading. Futures came off session lows on Friday, but still posted losses for the week. Traders will be keeping a close eye on the beef market after values softened last week But with April live cattle trading at a slight discount to last week's $126 cash cattle trade, downside risk should be limited unless beef values continue to soften.

Lean Hogs: Mixed. Futures are expected to be mixed this morning as traders reevaluate positions and work to narrow the discount April hogs hold to the cash index. But bears currently have momentum following last week's losses. The cash hog market is expected to be steady to weaker as packers work to improve ailing profit margins.


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