Sunday Night Grain Outlook, 3-23-08
Sunday Night Grain Outlook
By Duane Lowry
Sunday, March 23, 2008
OPENING CALL:
Corn= steady-easier, Wheat= steady-easier, Soybeans= steady-easier.
Weather remains favorable/acceptable for South America and offers no market influence. The US hrw wheat region still has some dryness concerns in the southwest corner. The US Midwest forecast will keep feeding planting delay concerns. I don’t see any weather information having a decisively influence on the trade, but certainly has potential to “explain” any corrective price strength if it occurs.
News> Overall financial market credit-related concerns continue to exist and most now believe the credit problems will last a long time. However, from a market influence perspective, we seem to be close to a point where traders will believe we have discounted those concerns enough for now.
Wheat has little for new news to discuss. Technical conditions are becoming a bit extended and oversold. Short-term downside objectives have largely been met. Longer-term downside potential exists, but with a major USDA report now just a week away, maybe this market can begin to lose downside momentum and experience some stabilization. Expect trade on both sides tonight and choppy action this week.
Corn may find some follow-through selling activity after last week’s hard break and limit losses again Friday. However, forced liquidation selling should be nearing its temporary end; with possibly some chart-related stops still another nickel or so below Friday’s levels. Preparations for the important March 31st USDA Planting Intentions report could create bottom-picking and short-covering opportunities as the week evolves. We seem to be close to a point where we should expect some short-term corrective strength to unfold, but overall we may still have lower levels to reach before the planting season arrives.
Soybeans will also need to determine how much more forced selling pressures may exist early this week, after last week’s smashing blow to the bulls’ equity. All chart-related stops should largely have been triggered. This market appears oversold and should seek to develop some consolidation activity before the March 31st USDA data is released. Expect trade on both sides, but limited trader interest in pressing the short side at this time.
In summary, financial market jitters appear a bit less intense for the short-term, but longer-term concerns exist. It would appear that other than some possible carryover forced selling that may exist, there should be little trader interest in pressing the short side of any of these markets prior to the March 31st USDA data, especially after such a large price washout in all markets. Expect stabilization activity to unfold this week.
This newsletter is prepared from information believed to be reliable. Early Market News, Inc. does not guarantee that such information is accurate or complete and it should not be relied upon as such. Opinions expressed are subject to change without notice.
