Grain and livestock closed mixed Tuesday.
Vince Boddicker, Farmers Trading Company, says corn and soybeans could not extend gains for a third day.
Both markets consolidated after two days of short covering and Boddicker says row crops ran into chart resistance technically, with strong crop ratings and favorable weather.
“It was nice to see we could take out Monday’s higher on Tuesday but somewhere in this $4.09 to $4.12 area in December corn you probably need more news to get through those resistance areas,” he explains.
November soybeans also hit technical resistance on the charts according to Boddicker.
“Last week when we rallied November soybeans we came right up to the $10.42, $10.43 area and failed miserably and you came up to the same area and stopped,” he adds.
Soybeans also got drug down by lower soybean meal prices and the lack of confirmation of China new crop exports sales which were rumored on Monday.
“I would think they’re going to do everything they can to buy from South America and not the U.S. unless its token purchases to keep the door open,” he says.
Boddicker thinks traders are also starting to gear up for the August 12 WASDE, with bearish expectations.
Wheat saw light short covering and a boost from higher Russian wheat prices, despite a stronger U.S. dollar.
Live cattle ended mixed trying to consolidate with the recovery in the stock market.
U.S. financial markets rebounded Tuesday along with a 10% rally in Japan’s Nikkei and Boddicker thinks the cattle futures overreacted to the break in global markets.
“If find amazing that in the cattle demand isn’t going to pick up when the stock market is putting new all-time highs in but its going to lose demand when the stock market goes down,” he adds.
However, feeder cattle made new lows for the move again with more technical selling on ugly charts.
Lean hogs closed higher with a short covering bounce and help from higher cutouts at noon.
