December 4, 2008 06:00 PM

Julianne Johnston Pro Farmer Senior Markets Editor

From Pro Farmer

Updated as of 7:00 a.m. CT

Friday finally comes... You know it's been a long week in the markets when you are so glad to see Friday come that you forgot how long ago Monday really was. Crude oil futures did more technical chart damage yesterday as they fell through the $45-per-barrel level, spurring widespread commodity selling.

Crude oil futures remain under pressure from ongoing economic concerns here and abroad, as traders believe hard economic times will trim usage. So, until confidence is restored in the economy, the path of least resistance will be lower and upside potential will be limited to short-covering and position squaring.

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Opening calls. These calls originate more than three hours before the open -- use caution, things change:

Corn: 4 to 6 cents lower. Futures were slightly lower overnight in lackluster trade. Futures extended losses yesterday to close 13 to 15 cents lower due to outside market influences and ongoing economic worries. March corn futures posted a fresh contract low of $3.33 1/4. Next downside target for bears is round the $3.25 area.

Soybeans: 4 to 5 cents lower. Futures were slightly lower overnight in lackluster trade. Futures saw sharp pressure yesterday, closing 18 to 19 cents lower. Outside markets were bearish, as well as weekly export sales data. Stats Canada also surprised the market with a record-large canola crop estimate. January beans violated support of $8.10, but closed a penny above it.

Wheat: 1 to 5 cents lower. Futures were slightly lower overnight in lackluster trade. Futures sharply extended losses yesterday as sell stops were triggered. Chicago wheat closed 30-plus cents lower. The combination of bearish outside markets, disappointing weekly export sales and a larger Canadian wheat crop weighed on wheat futures. March Chicago wheat violated support at the November low to post the next leg down in the decline.

Cash cattle expectations: $3 lower. Active cash cattle trade was seen in the Plains Thursday at $87 -- $3 below last week. Trade dried up as bids dropped to the $85 to $86 range late in the day. Cash sources say only two beef companies were buyers Thursday, which makes additional cash cattle trade likely today.

Futures call: Mixed. We'd sure like to call the market firmer this morning, but key will be if short-covering lifts the market following stiff technical losses. Futures were also pressured by $97 cash cattle trade, but are trading at a stiff discount to the cash market. February cattle posted a fresh contract low. Next support is found on the weekly chart at the July 2006 low of $81.95.

Cash hog expectations: Mostly steady. Cash hog bids are expected to be steady at most locations today, although scattered weaker bids can't be ruled out. Packers have this week's needs covered and have shifted their focus to buying hogs for early next week, and the average pork cutout value was down 72 cents to cut into packer margins.

Futures call: Mixed. Futures should see some short-covering support as traders even positions for the week, but given recent technical weakness, there is more downside risk open. Nearby hog futures worked on narrowing the premium they hold to the cash index, but downside risk was limited by spreading with deferred contracts and some firmness in the cash trade.  The CME lean hog index is projected up 43 cents to stand at $55.27. December hogs have trimmed the premium to around $2.

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