Floor Talk August 13

[marketeye]

After the close:

USDA rates the U.S. corn crop as 23% good/excellent, and soybeans 30% good/excellent.

Mike

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At the close:

The Dec. futures corn contract closed 17 cents lower at $7.92 1/4. The Nov. soybean contract settled 43 cents lower at $16.00 3/4. The Sep. wheat futures contract finished 28 1/2 cents lower at $8.56 3/4 per bushel. The Dec. soymeal futures contract closed $16.50 per short ton lower at $478.40. The Dec. soyoil contract settled $0.66 lower at $53.75.
In the outside markets, the NYMEX crude oil is $0.04 per barrel lower, the dollar is lower and the Dow Jones Industrials are 48 points lower.

Alan Brugler, President of Brugler Marketing & Management LLC, says rain and cool temps have trade expecting USDA to show unchanged or even slightly improved crop ratings Monday afternoon.
"Plus, the Friday USDA number may have been the lowest yield figure of the year, barring an early freeze.  Also difficult for spec funds to buy beans because there is little commercial selling on the other side. Too early for harvest, and South Americans have sold as much as they are comfortable," Brugler says.

Yet another analyst says, "This market traded all weather, Monday.  
"I am not sure USDA will show any improvement tonight (Crop Progress), but they will have to next week for sure.  These rains and cooler temps are taking the heat off the bears and shifting it to the bulls.  More rain coming late this week after a short warmup. So, I think lots of people are looking at a pattern change and one that could really help the beans recover," he says.

And a third analyst says watch out for a market correction.
"After hitting sharply higher prices off of Friday's crop report, followed by selling off of those highs, traders again today continue to trim profits," he says.
Fresh news is more rain in the near-term forecast, slowing of demand with the next supply side report a month away, he says. "This all sets up a profit-taking environment. It's very possible we're in for a seasonal post growing season/pre harvest correction," he says.

Mike

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Mike

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At mid-session:

The Dec. futures corn contract is trading 9 cents lower at $8.00 1/4. The Nov. soybean contract is trading 35 3/4 cents lower at $16.08. The Sep. wheat futures contract is trading 17 3/4 cents lower at $8.67 1/2 per bushel. The Dec. soymeal futures contract is trading $14.50 per short ton lower at $480.40. The Dec. soyoil contract is trading $0.42 lower at $53.99.
In the outside markets, the NYMEX crude oil is $0.44 per barrel lower, the dollar is lower and the Dow Jones Industrials are 15 points lower.

Mike

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At the open:

The Dec. futures corn contract is trading 13 1/2 cents lower at $7.95 3/4. The Nov. soybean contract is trading 30 cents lower at $16.13 3/4,. Sep. wheat futures opened 13 3/4 cents lower at $8.71 1/2 per bushel. The Dec. soymeal futures contract opened $10.50 per short ton lower at $484.40. The Dec. soyoil contract opened $0.54 lower at $53.87.
In the outside markets, the NYMEX crude oil is $0.65 per barrel higher, the dollar is lower and the Dow Jones Industrials are 61 points lower.

Mike

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At 8:41am;

No fresh export sales this morning.

But, Tom White, CME Group corn pit trader, and FutureRoad.net analyst that trades with a technical slant says, "The market traded lower in the early part of the week but was unable to take out the previous week’s low at 781.2. As it had traded well below the previous week’s close and high (807.4 and 820.6 respectively), we had large objectives higher on our price-based system when we came back through these areas on Wednesday and Thursday.  These objectives contributed to our bullish bias on Thursday and Friday.  The a.m. report contributed to all objectives being met as well as unmet gap/lap extension targets which were unfulfilled after Thursday’s gap higher in the open outcry session.  We should also note that we had identified a long-term positive reversal target several weeks ago (833) which obviously came in last week.

With all of our targets having been met, the market found a top on Friday and came back to an open gap area which was left from Thursday’s open.  When we finally broke through that area and the previous day’s low, we had decent selling to the 812, 809 intra-day objective areas  as given to our subscribers real time during the trading session.  We managed to still close slightly higher on the week but had a double reversal day on Friday. After double reversal days, the market generally tries to first rally on the following trading day but then sells off.  We also fell short of a pitchfork pattern and with any follow through, we’ll monitor for a potential test to the 795.6 area. 

The same chart, however, would still indicate that any move(s) lower are corrective for now.  If we have found a temporary top, it sure looks as if it would just indicate the end of the impulsive  Elliot wave 3.  This could lead to choppy, back and forth trade as we create a fourth wave.  The market could eventually trade to new highs.  The chart also shows that the market is far from making lower price lows at new RSI value lows.  If we don’t do so, we will create positive reversals.  We need to see how low the market can trade before we can identify new positive reversal objectives.  Let’s just say that if we turn back up in the very near term, the objective will be impressive to the upside," he says.

Mike

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our floorAt 6:30am:

Early calls: Corn 5-7 cents lower, soybeans 10-12 cents lower, and wheat 12-14 cents lower.

Trackers:
Overnight grain, soybean markets=Trading lower.
Crude Oil=$0.63 per barrel higher.
Dollar=Lower.
Wall Street=Seen opening flat on Japanese weakness.

World=Mixed-to-lower.

More in a minute,

Mike

[jrsiajdranch]

Gonna be an interesting day. Dollar lower with crude up could actually mean that we start lower and then move up. Any movement up in the corn mkt. in the next month. Will be from oil moving higher or the dollar moving lower. 

Watch Egypt the Muslim brotherhood is taking over the army and they will attempt to make the region unstable. As they do that oil shoots higher. Higher oil mean higher gas. Higher Gas means more demand for E. 

Also with Romney pick'n the worst possible candidate for veep ever we can be now 90% assured that BO doesn't have to worry about moving. That means more stimulus spending and QE infinity. This will lead to a weaker dollar. All of these things point to a much higher corn price.

Oh yea and don't forget about the drought which still hasn't been quantified. 

I do not see a down side yet.  (unless you are feeding this stuff!)

[nwiafmr]

The worst possible "veep" is the idiot we have now for "veep".....!    Biden was the democratic answer to the previous worst "veep" ever, Republican Dan Quayle.......!   I am a registered Democrat, have been for a long time, but I can guarantee you I will not be voting for the @&%$$# we have now for President........!    I am not going to make the same mistake twice......

[vandenplas]

Sounds like you are voting your pocketbook, or you are a right winged evangelical, masquerading as a democrat.

[cornhead64]

I usually vote R, but can not EVER consider it now.  My taxes have been lower I guess, but there is just too much uncertainity with Rommeeee.  I have never in all my days seen one candidate be on so many sides of an issue.

I pretty much got what I expected with BO - with exception of him sticking up for same sex marriages, I am not seeing too many things he didn't run on.

Maybe some of the QE, but most of that was repaid wasn't it ?

[docharing]

Obama and Biden will be swept out with a tide of cleansing Republican water. Romney was not my choice, but it doesn't matter, the country has had enough of a poor economy. The other side gets a chance now.

[roarintiger1]

FWIW, I would love to see a debate between Biden and Ryan......I highly doubt that the O- camp will let that happen.      🙂

[vandenplas]

It'll happen.

[nitefarm]

Yea that is one of the reasons our debt is so small.        not.

[nwiafmr]

Vanderplas......if I was voting my pocketbook, I would be voting for the current administration....in other words, the status quo....farming has never been better!    With deficits in the tens of trillions of dollars and no end of more in the future, something has to change.....!   I think adding Paul Ryan as the vice presidential candidate is going to be the democrats worst nightmare.    I can't wait to watch the Biden/Ryan debate......