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Transcript:
Alright, we teased it Oliver Sloup with blue line futures in Chicago. Oliver, what are you watching?
Well, the grain markets just kind of stuck in the middle of no man’s land here to start the week, we had December options expire on Friday, so that puts the December contracts for corn and wheat into first notice day this week, and the volume and trade shifts out to those March contracts. So that’s going to be the month of interest for us here in the near term and for corn, or just like I said, right stuck in the middle. Support, 427, to 429, and resistance, 439, to 442, I wouldn’t be surprised to see us maybe bounce around within that trading range, especially knowing that it’s a holiday week, and once we get past today and into tomorrow afternoon, you might see some of these market participants head for the exits early to celebrate a long weekend soybeans. On the other hand, you might see a little bit more volatility weather down in Brazil. That’s going to continue to be very important going forward. I think Agrawal released their statement stating that soybeans were 86% planted. So as that crop continues to get in the ground, weather is going to become a more important factor going forward, and should create some volatility.
You know, Oliver, I read something earlier, Brazil’s current account deficit $5.9 billion and obviously it’s a deeper deficit than this time last year, but they say it’s due to a sharp decline in good surplus and a slowing Chinese economy. So now bringing that back into AG, if that’s if the Chinese economy is slowing and affecting Brazil like that, are there other markets the US can be looking for, as far as buyers for, let’s say soybeans.
Well,
we’ve been watching the Chinese economy very closely and kind of hoping that they would eventually turn they’ve thrown a lot of stimulus at the market over there, and each time, it just seems to be a little bit less than what the market actually needs. But when they do turn that corner, I think there will be a lot of opportunities, especially when you’re looking at commodities such as the grade markets that are at multi year lows. Now we’ve got our own problems with a pretty darn big balance sheet, but if China can turn the ship and right that ship, I think there’s opportunity to the upside. Then on top of that, we’ve got a new administration coming into office when we turn the calendar over, and potentially you know, those trade talks go a little bit better than expected. I know there’s a lot of negativity priced in, but I think the fact that it could go better than expected is is not being covered enough.
Well, let’s take that ship and bring it into the harbor for a minute. We’ll take a break and come back and set sell with livestock futures. Next market day report. Can we bring back in Oliver Sloup Oliver, we could talk Commitment of Traders. I had that note down from your commentary this morning. But really, when you watch it, watch what’s happening in the cattle market right now that that’s not tied back to Commitment of Traders, is it? No,
I wouldn’t say so. And really it’s not even tied back to the cattle on feed. This is, I think today’s action is on the back of the USDA reporting screw worm impacting imports of beef from Mexico into the United States. And so you’re seeing the surge higher in the cattle complex. And part of me wonders if somebody didn’t have a little bit of a heads up on this last week. You know, I don’t think the USDA and two foreign governments just came together on Friday afternoon to put out a statement. I think they were putting together a statement prior to that. That may have been the catalyst for some of last week’s strong price action, but nonetheless, now that we got that statement, we’re seeing some follow through to the upside. It’ll be interesting to see how we trade, not just through today, but through the rest of the week, on the back of this headline, because that is such a big market, moving headline out of Mexico, and how long that is going to be in place, I think is going to be the big question going forward. And you’d mentioned commitment to traders funds are very, very aggressively long in all these markets, live cattle, feeder cattle and lean hogs. So I guess it’s tough to say how much more aggressive they can get to the buy side, despite the strong fundamental backdrop they have. All
right, that’s the livestock market. Before we go anything you’re watching in maybe the outside markets. Are you keeping an eye on metals or energy markets? Well, the
metals are just getting slammed. Bonds are on the rise. So interest rates are going down, stocks are up. There’s a lot going on this week. We had some announcements over the weekend through Trump’s cabinet choices, and that’s kind of putting some volatility in some of these outside markets. So despite it being again, a holiday week where we typically see a slower trade. Into the back half of the week, there could be some surprises yet to come.
Okay, Oliver slopes with blue line
futures. Oliver, we don’t get to see on Thursday, so we’ll see you back here next Monday. Oliver Sloup, Blue Line futures, you know he did you
On the date of publication, Oliver Sloup did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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