AM Comments 05/25/16
Wednesday, May 25, 2016, 1:05 PM
Submitted by: Dustin Weiner
We had firmer markets overnight, once again led by the soy complex. On a chart, July soybean futures managed to hold onto some key support levels yesterday which eased the concerns some technical traders had. Soybean meal saw record trade volume yesterday and this morning it is back trading near recent highs. Looking at soybean futures, if it wasn’t for the strength in meal the soybean chart looked like it was fairly close to rolling over... It will be interesting to see how that unfolds.
The outside influences are coming at us from multiple directions, first we have a stronger $US (highest level since March) which in theory keeps commodities under pressure. We also have stronger energies, with crude oil approaching 7-month highs. You throw in a bunch of unknowns about the Chinese and their economy and it is easy to say that we have an unsettled market. The underlying driver however still seems to be fund buying/length. It is hard to come up with a scenario where the funds bail on their long position anytime soon, as the money will likely try to stick around to see what the mid-summer weather looks like. This could keep our markets (soybeans in particular) from encountering major set-backs in prices until then.
Corn 1 to 3 cents higher
Soybeans 4 to 8 cents higher
Have a great day!
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