Decent exports Thursday morning in corn and beans, giving us an early floor and short term sell programs were forced to comer back out. Corn had a solid run up but backed up a nickel to 541, still plus 6 1/2. Beans up 13 1/2 to 1367 1/2 with meal up $6 as well. Options Vol seemed to waiver more on the upside run. Wheat down 2 cents, 633 1/2. Rice spread roll the feature again, 1289, plus a penny. Dow doing the same old same old, bid it up to new highs, back and fill, bid it back up for the close. When it gets this obvious, something different usually happens. 31,359, plus 31. Bonds slip 9 tics, 167.08
Wednesday trade opened soft and took hits all day long. Clearly new sell systems joining the selloff and pushing lows for the close. Corn off 21 3/4 to 534 1/2, but OI only down 4K , so if the fund long was selling out, and the computer sellers were operating, who was willing to add to their longs? Commercial? Its a Wednesday, so commitments will keep that info hidden an extra week. Sort of the same story in beans, off 47 3/4 to 1354 and OI higher. Meal dropped $16. Wheat off 14 cents, 635 1/2. Rice roll continues and some curious Vs. cash, 1288, off 3 1/2. Dow punches a new high and sets back to 31,328, plus 50, and bonds gain 13 tics, 167.17.
WASDE report dropped beans down to 120 CO, about as expected, but left plenty more corn and wheat out there to keep a drag on the market. Beans up 14 to 1401 3/4 but off the highs and pushed back over the buck for the close. Corn numbers north of 1.5 leave us with more ending stocks than the computers had expected, and that will be a drag, especially after we get Thursdays big export shipments out of the way I am afraid for the short term. Wheat off 6 1/4 to 649 1/2 with nothing numbers and corn down 7 1/2 to 556 1/4 with at least 100K more carry over than most expected. Rice gained a small amount of LG CO, basically a punt, 1291 1/2, minus 5 1/2. Dow had a quiet 200 point churn after posting new highs, and closed 10 points higher, 31,278, while the bonds just slept, 167.04, unchanged.
Huge inspections Monday morning for export fuel beans and corn going into the Tuesday WASDE report. Positions cleaning up favored the long as well, as open interest shows us this wasn't really new longs. 563 3/4 corn close is 15 1/4 higher, but only 3K increase on OI. Beans rally 21 to 1387 3/4 with $6 stronger meal, but bean OI drops 4K. Wheat up 14 1/2 to 655 3/4 with a 7K drop in OI. Rice closes 1297, minus 3 with roll volume and someone buying 70 upside may calls. Just glad to see some options volume come back to rice. Speaking of volume, there were various reports about bean call verticals around, but CME show it was the may 17-18 vertical trading 8-9K times, financed by 15$ march calls. Someone has 20,000 of them now. Long term play, but in line with some of the stuff they did in rice last year to fuel the bull later in the years run. 2012 high was 17.89. Dow up 226 to 31,268, and bonds bounce a point off the low to close 167.04, plus 14.
Real grain story of Friday is that bulls need fed, and spread rolls with no big news generally generate at least some net selling, with the hit to total open interest as the marker. Corn loses 1 1/2, flat price and spread, 548 1/2 with a small drop in OI. Beans off 5 3/4 to 1366 3/4 with spread loss, OI loss, and meal off a couple bucks. 1300 rice is off 2 1/2 with a small spread roll loss and OI drop. Rice was off 20 early as the bear tried to push but couldn't find any company, allowing for the bounce back up to only off 2 1/2. Wheat had the same spread roll story, but up 3 3/4 to 641 1/4, regaining part of Thursdays losses. Dull and low range Friday Dow with a close 92 points to the good, 31,042. Seems like every Friday they want to dress up the Dow as best as they can. Bonds see new contract lows, again, as the big money continually, but quietly, leaves the party, 166.23, off 24. We are off a solid 15 full points since this move started to become obvious. Most have not noticed.
Export sales Thursday morning had Ag talking early, but even with stupid big corn numbers we couldn't follow thru. After a brief look at new highs, we close corn off 2 cents, 550. Wheat was a drag, 637 1/2, minus 10 3/4. Beans managed to close positive by 1 1/4 cents, 1372 1/2 but meal was soft and off a couple bucks at the end. Rice lost 6 1/2 to 1302 1/2 in quiet spread roll trade and not even an option to think about. Grains this dull with the Dow popping another 33 to 30,950, and bonds leaking 12 tics to 167.15. New low in bonds as the big money quietly exits long term debt, Don't worry, the treasury will be left holding the bag one day and it will all come as another "surprise". Sidelines still looking attractive to me. When you have been playing and winning, you never want the coach to pull you, But if you burn out in the first half, you might not be on the field when the big plays happen later in the game.
Firm trade all day in corn and beans with china stories leading the way. Corn up 9 to 552 on new china sales, and wheat was 20 lower but bid all the way back to 648 1/4, higher by 3 1/2. Beans up 16 1/2 to 1371 1/4 with meal up $7, and I hate to say this, but beans appear to be caught in the churn machine as well. Look back at the last two weeks action and ask yourself if we are having price discovery, or computer churn profit discovery. Don't know what changes that for the next month unless WASDE is a big surprise. Rice trailing stops got exposed and we broke 60 early, but recovered thru the day to 1309, off 27. Dow in a slow 300 point catch your breath and let the systems reset trade, 30,627, plus 41. Bonds off 19 tics, 167.27, just following the path of least resistance.
Tuesday softness had declining prices and declining open interest as a few longs hit the sidelines. Corn off 6 1/4 to 543, with wheat off 6 1/4 as well, 644 3/4. Beans slip 10 1/2 to 1354 3/4 but meal looks to be probing for a bottom. Rice quiet and up 2 cents, 1336. Dow bid all day and closes up 476 points, 30,586 with bonds giving up 18 tics, 168.14. I guess the hedge funds think its safe to reinvest across the floor since they have averted the game stop blowup. I'm thinking game stop is nothing more than the canary in the coalmine. Not sure how I want to proceed.
New month trade tried to put up some follow thru but mostly just couldn't get any mojo going. Monday corn traded 555 but drifted off to 549 1/4, plus 2 1/4. That's the best one. Rice off 12 to 1334, but holding the $6 mark. Beans look higher but end off 4 3/4 cents, 1365 1/4. Wheat off 12 to 651. Dow did catch a bid in a big range churn day, 30,110, up 231 points, while bonds gain 9 tics, 169 even.
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