Financial room pretty unstable Monday with the Dow out of the box strong but faded thru the day to 37,993, off 245 points. Bonds threw away the Friday rally and lost a point and 30 tics, 114.09. Wheat struggling at 551 3/4, off 4 1/4 and corn slips 4 as well, 431 1/2. Both products soft in the soy complex and beans drop 15 3/4 to 1158 1/2. Will be interesting if we test a psychological 1150 to see what action it draws. Rice trades limit up a buck 10 better and will have expanded limits on Tuesday.
Friday trade pretty much was a sell the rumor buy the fact with a bit of a delay. Thursday the funds tried to work grains lower in waves and really didn't succeed nearly as well as it felt. Meal was a surprise to the bid side and beans went along for the ride, 1174, plus 14 3/4. Solid corn recovery from Thursday as well with a 6 3/4 cent bounce, 435 1/2. Open interest dropped 20K as some of the short-managed money probably decided they have been at the bear dance long enough. Wheat up 4 1/4 in sympathy, not sure whether that's with corn or KC but still a bump up to 556. Rice break didn't last long as the bulls showed up Friday and the bear withered away, 1723, up 36 cents. Dow took it on the chin, off 494 points, 38,238 undoubtably concerned about geopolitical risks over the weekend and bonds up 31 tics, 116.07 on a small flight to safety.
Build up for export sales and WASDE Thursday fizzled with nothing really exciting in exports and a slightly bearish bean stocks number. Beans lost 5 1/2 following weak bean oil lower, 1159 1/4. Corn off 5 1/2 as well, 428 3/4. Wheat testing some lower areas of support, 551 3/3, down 6 3/4, and the rice bear pushed us 28 lower, 1687. I don't know about you, but that day of trade felt much worse than the end numbers imply. Thats maybe a good sign moving forward. Dow needed a 250-point bounce to not look terrible, 38,732, off 25 and bonds slipped another 10 tics, 115,08.
Wednesday trade in front of WASDE tomorrow and export sales is just looking for direction. Corn got 3 cents back from the Tuesday break, 434 1/4. Wheat was a dime better early but faded to 3/4 better by the end, 558 1/2. Meal off 4 1/2 bucks and soy drops 9 3/4 to 1164 3/4. I believe beans have priced in a bit of a bearish report recently so we might be setting up a sell the rumor and buy the fact trade Thursday at 11. Rice up another 53 1/2 to 1715 and over a dollar rally in the last 2 days. New short sellers got their hand whacked too long in the cookie jar. Not a fan of the open interest drop in May and lack of spread roll. Financials hits bonds down 2 points and 13 tics while the Dow drops 439 points, 38,757. Higher for longer inflation is the story but I'm starting to wonder if globally we are losing the capacity to put the genie back in the bottle.
Tuesday the start of settling up positions in front of Thursday WASDE report with wheat off 8 to 557 3/4 and corn slipping 4 1/4 to 431 1/4. Beans off 7 cents, 1174 1/2. Rice shorts caught and we pop 50 cents, 1661 1/2. I can't stress how thin rice is now and moves will be more violent. Dow cracked down to the recent lows, 38,873 before bouncing all the way back to 39,196, losing only 23 points at the end of the day but establishing a downside hole that is gaping. Bonds up 27 tics, 117.31.
Monday brought a really cool solar eclipse and not much else. Corn gained 1 1/4 to 435 1/2 as the highlight of the day. Wheat slipped 1 1/2 to 565 3/4 and beans followed soy oil lower for a 3 1/2 cent loss, 1181 1/2. Nothing day in the financials with the Dow off 4 points, 39,219 and bonds off 13 tics, 117.04. Bonds did seem to reject the lows and time will tell if we have finally run the course for this break.
Beans gain a nickel Friday on the back of bean oil bids, 1186. Wheat up 11 to 567 1/4. Russia seems to have found a floor or has already oversold a bit. Corn slips a penny in dull trade, 434 1/4. Funds big ag short is still with us but the clock is working against them. Planting needs to progress in a very timely manner with some good weather to boot. Managed money should use this next week or two to make a new push down if they can, or I believe the clock will run out on them. 1616 rice was off 4 cents as most all the big fund long has liquidated, and shorts have entered the fray. Commercial has cleaned up their short position nicely and was a net 1650 contract buyer last week. Thats a pretty impressive turn. Higher for longer interest rates have the Dow 307 points higher on a solid bounce off Thursday break while bonds lose 28 tics, 117.17. I have abandoned trying to catch the bond knife until the Fed comes up with better guidance. Nothing stopping us from checking the old lows even though it doesn't make sense to me today.
Exports Thursday morning didn't bring any surprises and the ag floor mostly stalled looking for a leader. Wheat plus 1/4 cent, 556 1/4 and corn picked up another 3 1/2 to get back Tuesdays loss over the last 2 days trade. Churn. 1180 beans off 2 1/4. Rice bear hit us for 31 with a late pressure although he didn't get what I think he wanted as far as erasing the Wednesday pop. Dow was ugly, off 566 points, 38,916 while bonds gained 20 tics, 118.13.
Financials stabilized Wednesday with the Dow off only 26 points, 39,482 and bonds up a couple tics, 117.25. Grain room got a nice bounce as Tuesday break had no sponsor to continue the push. 431 3/4 corn was 5 1/4 better, wheat gained 10 3/4 to 556, and beans got back 8 3/4 of the break, 1182 1/4. Rice sellers weren't getting paid and small short covering led to big gains in futures, 1651, for a nice 43 cent pop. It's been a 3-buck break, and milling yields aren't getting any better. Tomorrow trade will be interesting to see if we are a fish flopping around or are we basing.
Financials weak Tuesday so no extra fuel for the grain room to be found. Dow bounced 140 off the lows, 39,508, still lower by 386 points. Bonds off another 25 tics, 117.23 and maybe cheap enough for now. If not soon, something much bigger is probably just under the surface. Corn gives back report gains with a 9 lower, 426 1/2 close. Wheat off 11 3/4 as well, 545 1/4. Meal looking to check out 320 at some point it seems and drags soy down 11 3/4 to 1174. Rice march down continues, 1608, off 21 1/2.
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