AM Comments 12/03/14
Wednesday, December 3, 2014, 8:12 AM
Submitted by: Dustin Weiner
Our markets are all lower this morning with most of the blame being attributed to yesterday’s nasty technical performance. The charts seem to be telling us: don’t be surprised if there are additional rounds of selling between now and the end of the year. The soybean market broke out the bottom of its head and shoulders pattern which now points to another 40c drop from here down to 9.46 on the Jan futures.
Recent weakness in energy prices is a key input here also as dropping crude is rallying the $US, especially in comparison to other countries whose economies are directly tied to energy. Yesterday for example, Russia officially projected a bit of a recession coming in 2015 – with a good share of the blame being on the price of crude oil. In an ultra-simplistic view… crude oil drops, their economy takes a hit and slows, their currency devalues, and goods become more expensive for their citizens.
Weather… here in the US the extended outlooks show above normal temps for most of the country (where’s our “White Christmas”???). Meanwhile in Brazil the pattern has definitely shifted to show strong chances for heavy precip – which is replenishing soul moisture. This weather in Brazil has also been a factor as to why soybean prices are dropping.
Corn 2 to 3 cents lower
Soybeans 6 to 9 cents lower
Have a great day!