Grains end mostly lower Friday, with cattle and cotton leaning mostly higher.
Darren Frye, Water Street Solutions, says the grain markets saw risk off selling tied to President Trump’s threat of 50% tariffs on the EU starting on June 1.
However, grains also saw some profit taking after running into chart resistance and heading into a three day weekend.
Weather and technical buying pushed grains higher for the week but can the market build on that next week?
Frye says it will take continued weather concerns in the U.S. and globally to support additional buying.
There are some corn acres at risk in parts of the Corn Belt like the Southeast which may end up being switched or put into prevent plant.
The question is whether or not it is enough acres to keep the market adding weather premium?
Frye says the other key will be what headlines the grain markets chase after next week regarding trade.
Cotton futures were higher Friday and could be the sleeper market according to Frye as exports have started to ramp up at the same time acres could also be in jeopardy in states like Texas with excessive rain and possible prevent plant.
Cattle futures ended mostly higher, rebounding from early pressure tied to the plunge in the financial markets.
Cash was $2 higher this week and with futures at a discount that helped to support the board, plus positioning ahead of the USDA Cattle on Feed Report.
Frye says while the technical picture in cattle looks better than a week ago the bearish key reversals are still in place.
However, he’s not sure he’s willing to call a top in the market just yet.
