Here’s How Copper Is Related To The Stock Market

News that Egypt bought 120,000 tonnes of US corn
this morning helped to provide some early support. Traders are looking for
another adjustment lower in exports and higher in ending stocks for Friday’s
USDA Supply/Demand report and this helped to keep the market under long
liquidation selling pressure over the past week but the export data does not
support this idea. However, if the USDA believes the GMO issue might hurt
exports short-term, the forecast may be adjusted lower. In last weeks weekly
sales report, cumulative export sales had reached 71% of the USDA forecast for
the season as compared with 69.2% as the 5-year average for this time of the
year. Traders are looking for ending stocks to jump by near 100 million bushels
from last months report of 2.055 billion bushels as adjustments are also made
following the quarterly grain stocks report of last week. Cash basis levels were
steady and with more attention to fieldwork soon, cash dealers see producer
movement as slow over the near-term. For the weekly export sales report,
released before the opening, traders are looking for corn sales near
700,000-900,000 tons as compared with 1.158 million tons last week. May corn
support comes in at 206 1/4 and 205 with 210 1/4 and 211 3/4 as resistance.

Technical Outlook

CORN (MAY) 04/07/2005: Momentum studies are
declining, but have fallen to oversold levels. The close below the 18-day moving
average is an indication the longer-term trend has turned down. The market setup
is supportive for early gains with the close over the 1st swing resistance. The
next downside objective is 205. The next area of resistance is around 208 1/4
and 209 1/4, while 1st support hits today at 206 1/4 and below there at 205.

 

SOY COMPLEX RECAP

4/6/2005

May Soybeans finished up 5 3/4 at 623 1/4, 4 1/4
off the high and 6 1/4 up from the low. November Soybeans closed up 5 1/2 at 611
3/4. This was 5 1/4 up from the low and 3 3/4 off the high.

May Soymeal closed up 2.5 at 186.6. This was 2.3
up from the low and 1.3 off the high.

May Soybean Oil finished up 0.04 at 22.86, 0.17
off the high and 0.01 up from the low.

The hook reversal from yesterday and the move
above yesterday’s highs is a supportive technical development and triggered some
increased technical buying and higher trade. Talk that the USDA report on Friday
will show higher exports and lower ending stocks helped to support the new
buying. Traders are looking for ending stocks to drop by near 40-50 million
bushels from last months estimate of 410 million bushels as adjustments are also
made following the quarterly grain stocks report of last week. Rains in southern
Brazil could slow harvest and is also providing some support. Cash traders
believe that if producer selling is enough to fill the pipeline that a slowdown
in exports could pressure the market, however, if producer selling is tight,
basis levels or the futures market may need to push higher in order to see
increased availability in the cash market. If grain is not available for prompt
shipment from ports in South America, US export sales could remain relatively
strong as well. For the weekly export sales report, released before the opening,
traders are looking for soybean sales near 400,000-600,000 tons, meal sales near
75,000-125,000 tons and oil sales at 0 to 5,000 tons. Midwest cash basis levels
are firm as crushers are bidding up cash in some areas. May soybean support
comes in at 618 with 628 1/4 and 634 1/2 as next resistance.

Technical Outlook

BEANS (MAY) 04/07/2005: Momentum studies are
declining, but have fallen to oversold levels. The close below the 18-day moving
average is an indication the longer-term trend has turned down. With the close
higher than the pivot swing number, the market is in a slightly bullish posture.
The next downside target is 612 1/4. The next area of resistance is around 628
1/2 and 633 1/4, while 1st support hits today at 618 and below there at 612 1/4.

MEAL (MAY) 04/07/2005: Daily stochastics are
trending lower but have declined into oversold territory. The market back below
the 18-day moving average suggests the longer-term trend could be turning down.
Market positioning is positive with the close over the 1st swing resistance. The
next downside objective is now at 182.8. The next area of resistance is around
188.4 and 189.9, while 1st support hits today at 184.8 and below there at 182.8.

BEANOIL (MAY) 04/07/2005: Momentum studies are
declining, but have fallen to oversold levels. The close below the 18-day moving
average is an indication the longer-term trend has turned down. It is a mildly
bullish indicator that the market closed over the pivot swing number. The next
downside target is 22.72. The next area of resistance is around 22.94 and 23.08,
while 1st support hits today at 22.77 and below there at 22.72.

 

WHEAT MARKET RECAP

4/6/2005

May Wheat finished up 3 at 314 1/4, 2 1/2 off the high and 1
1/4 up from the low. July Wheat closed up 3 1/4 at 324 1/2. This was 2 up from
the low and 1 1/2 off the high.

After closing lower for 7 sessions in a row,
short-covering helped to support a bounce today on ideas that the market was
technically oversold. News that Taiwan bought 44,820 tonnes of US wheat and that
South Korea bought 18,000 tonnes of US wheat overnight helped provide some
support. Exporters feel that the recent sharp break might help the US be a bit
more competitive on the world market. Positioning ahead of the Supply/Demand
reports for Friday morning helped keep the trade active with most traders
looking for a slight decline in ending stocks from last months estimate of 553
million bushels. Some traders were looking for less feed usage and higher ending
stocks. The Crop Production report does not include wheat until next month. The
first weekly crop progress report of the year this week showed the crop rated in
good to excellent condition at 68% as compared with 48% last year and 56% as the
15-year average for this time of the year. For the weekly export sales report,
released before the opening, traders are looking for wheat sales near
350,000-500,000 tons as compared with 415,400 tons last week. May wheat
resistance comes in at 319 1/2 and 323 3/4 (50-day moving average) with 309 1/2
as next support.

Technical Outlook

WHEAT (MAY) 04/07/2005: Momentum studies are
still bearish but are now at oversold levels and will tend to support reversal
action if it occurs. The close below the 18-day moving average is an indication
the longer-term trend has turned down. With the close higher than the pivot
swing number, the market is in a slightly bullish posture. The next downside
target is now at 311. With a reading under 30, the 9-day RSI is approaching
oversold levels. The next area of resistance is around 316 and 318 1/4, while
1st support hits today at 312 1/2 and below there at 311.

 

LIVE CATTLE RECAP

4/6/2005

April Live Cattle finished down 1.00 at 87.95,
0.85 off the high and 0.05 up from the low.

May Feeder Cattle closed down 1.60 at 104.07.
This was 0.02 up from the low and 1.52 off the high.

June cattle closed sharply lower and moved into
the gap area left on March 3rd. Weakness in the pork market due to the prospect
of more hogs from Canada helped to pressure the market. In addition, traders are
concerned that the available supply of market-ready cattle coming off of
feedlots will be increasing in the weeks ahead. Funds were holding a hefty net
long position in the last COT report and the trade is also concerned that the
funds are in a long liquidation mode with the first move under the 50-day moving
average since early March. Boxed-beef cut-out values at mid-session were up $.29
to $154.75 as compared with $151.04 last week. Slaughter came in at 121,000 head
from trade estimates of 116,000-121,000 head.

Technical Outlook

CATTLE (APR) 04/07/2005: The market back below
the 60-day moving average suggests the longer-term trend could be turning down.
A bearish signal was triggered on a crossover down in the daily stochastics.
Negative momentum studies in the neutral zone will tend to reinforce lower price
action. The market back below the 18-day moving average suggests the longer-term
trend could be turning down. There could be some early pressure today given the
market’s negative setup with the close below the 2nd swing support. The next
downside target is 87.270. The next area of resistance is around 88.400 and
89.020, while 1st support hits today at 87.520 and below there at 87.270.

 

LEAN HOGS RECAP

4/6/2005

April Lean Hogs finished down 1.77 at 66.90, 1.30
off the high and 0.05 up from the low.

May Pork Bellies closed down 1.30 at 92.10. This
was 0.07 up from the low and 1.40 off the high.

June futures closed sharply lower and moved to
the lowest level since February 15th. Concerns that the International Trade
Commission would stop the anti-dumping duties imposed on Canadian hogs and
feeder pigs moving across the border helped trigger the initial selling surge.
After the announcement and confirmation that the tariffs would be dropped, the
market bounced off of the lows but the news was bearish enough to keep the
market in a long liquidation mode. The commission determined that Canadian hogs
did not harm US pork producers and that the tariffs would end sometime after
April 18th. The increase in feeder pig imports should help boost the US pork
supply for the second half of the year but the slower imports of feeder pigs
since November could be felt as lower than expected pork production for the
April to June time frame. Weekly average weights for Iowa/Minnesota for the week
ending April 2nd came in at 267.9 pounds from 267.8 last week and 265.6 pounds
last year. The CME 2-day lean index was up 23 cents to 67.36 as compared with
67.33 the previous week. Slaughter came in at 393,000 head from trade estimates
of 394,000-396,000 head.

Technical Outlook

HOGS (APR) 04/07/2005: A crossover down in the
daily stochastics is a bearish signal. Momentum studies are declining, but have
fallen to oversold levels. The close under the 18-day moving average indicates
the longer-term trend could be turning down. The gap down on the day session
chart is bearish with more selling pressure possible today. The defensive setup,
with the close under the 2nd swing support, could cause some early weakness. The
next downside target is 65.870. The 9-day RSI under 30 indicates the market is
approaching oversold levels. The next area of resistance is around 67.570 and
68.550, while 1st support hits today at 66.250 and below there at 65.870.

 

COCOA MARKET RECAP

4/6/2005

May Cocoa finished unchanged at 1555, 15 off the
high and 45 up from the low.

While July cocoa managed to return to the
vicinity of the prior days closing value, the market at times Wednesday
displayed significant weakness. We suspect that the progression toward Peace at
the Ivory Coast undermined the market but in the end, the market apparently
doesn’t think that any Peace at the Ivory Coast is a lasting affair. However, in
the near term we suspect that the tendency toward Peace will undermine prices
and could result in prices falling back toward the January lows.

Technical Outlook

COCOA (MAY) 04/07/2005: Momentum studies are
declining, but have fallen to oversold levels. The close below the 18-day moving
average is an indication the longer-term trend has turned down. It is a slightly
negative indicator that the close was under the swing pivot. The next downside
target is 1488. The next area of resistance is around 1585 and 1607, while 1st
support hits today at 1525 and below there at 1488.

 

COFFEE MARKET RECAP

4/6/2005

May Coffee closed down 1.40 at 124.70. This was
0.50 up from the low and 4.15 off the high.

July coffee opened higher but closed lower on the
day as a lack of new speculative buying support on the early move to the highest
level since March 22nd helped to trigger a long liquidation trend for much of
the day. July closed 135 lower on the session and down 410 points from the highs
of the day. London futures pushed sharply higher on the day to provide early
support in New York. Volume was considered light and traders expect trade house
buying support on further weakness.

Technical Outlook

COFFEE (MAY) 04/07/2005: The close below the
40-day moving average is an indication the longer-term trend has turned down. A
bullish signal was given with an upside crossover of the daily stochastics.
Daily stochastics are showing positive momentum from oversold levels, which
should reinforce a move higher if near term resistance is taken out. The market
back below the 18-day moving average suggests the longer-term trend could be
turning down. The daily closing price reversal down puts the market on the
defensive. The market tilt is slightly negative with the close under the pivot.
The near-term upside objective is at 130.25. The next area of resistance is
around 127.00 and 130.25, while 1st support hits today at 122.40 and below there
at 121.00.

 

SUGAR MARKET RECAP

4/6/2005

May Sugar closed up 0.02 at 8.57. This was 0.08
up from the low and 0.07 off the high.

July sugar closed just 1 tick higher on the
session in choppy, two sided trade as early strength was met with more long
liquidation selling and some rolling of long positions out of the nearby
contracts and into the deferred contracts. While the short-term cash demand is
still in question, traders view the longer-term demand issues in sugar as
bullish. In the long run, traders are optimistic that a higher percentage of the
Brazil cane harvest will move to alcohol production and away from sugar
production. In March, flex-fuel vehicle sales in Brazil jumped to 53,300 units
as compared with 35,200 last month and just 20,800 cars in March of last year.
The vehicles can run on gasoline, ethanol or a mixture of both.

Technical Outlook

SUGAR (MAY) 04/07/2005: Daily stochastics are
showing positive momentum from oversold levels, which should reinforce a move
higher if near term resistance is taken out. The close under the 18-day moving
average indicates the longer-term trend could be turning down. The market has a
slightly positive tilt with the close over the swing pivot. The near-term upside
target is at 8.71. The next area of resistance is around 8.64 and 8.71, while
1st support hits today at 8.50 and below there at 8.42.

 

COTTON MARKET RECAP

4/6/2005

May Cotton finished down 0.17 at 51.88, 0.12 off
the high and 0.63 up from the low.

May cotton pushed lower for the 7th session in a
row but short-covering and trade house buying supported the late surge of 75
points to close near unchanged on the day. For the weekly export sales report,
released before the opening, traders are looking for cotton sales near
150,000-225,000 bales as compared with 165,000 bales last year. Fears of trade
retaliation on China cotton imports helped pressure the market in the past few
session but ideas that demand will remain strong helped support.

Technical Outlook

COTTON (MAY) 04/07/2005: Momentum studies
trending lower at mid-range should accelerate a move lower if support levels are
taken out. The market back below the 18-day moving average suggests the
longer-term trend could be turning down. The market tilt is slightly negative
with the close under the pivot. The next downside objective is 51.01. The next
area of resistance is around 52.25 and 52.50, while 1st support hits today at
51.51 and below there at 51.01.