What’s Up, What’s Down: A Focus on Grains and Meats

Comments for Thursday, October 22, 2009

Looking Ahead to Today by Reflecting Back at Wednesday’s Price Action


Higher to sharply higher closes yesterday for Minneapolis, Kansas city and Chicago wheat along with corn rough rice, oats ,soybeans soymeal and soyoil. All of the wheat continues showing bottoming signs making new recent highs and closes along with oats, soybeans and soyoil. The lower dollar (new contract low and close) and delayed harvest conditions due to wet weather have helped rally the the grains along with the funds doing some significant also despite this being the largest corn crop in history. Most of the farmers that I’ve talked to consider the latest grain rally a gift. However, I still base my decisions off the technicals learning from experience the worst losses that I’ve taken came from trades that I had the strongest convictions. Beans broke out of a BULL TRIANGLE looking strong along with oil while meal lags behind but still is also in an up-trend. Corn continues heading towards the 400 area basis the December contract and oats had another good close. Only rice is neutral overall basically in a trading range between 13500 and 14500 since the beginning of August. Buy Signals for Wheat, Corn, Oats and the Soybean complex.

Rough Rice Chart

Corn Chart


Higher closes Wednesday for live and feeder cattle along with lean hogs and pork bellies. The overall trend for live cattle is starting to turn up but not yet for the feeders although both made new recent highs and closes. The December cattle’s double DOUBLE BOTTOM now has significant meaning as the cattle keep moving higher at contract lows continues to hold and now I have a BUY SIGNAL. The feeders had a huge trading range today settling in the upper half but still looking very weak overall. Hogs also had a huge trading range but making its lowest low and close in 8 trading sessions. Now the key price in the December contract is 5200. Bellies had their lowest close in over a week with 8000, basis the February contract, a key area to hold at this time

See the balance of my morning comments, including the Metals, Softs, Energies and Grains, at my website. For my complete coverage, visit my commentary page at www.markethead.com.

Rick Alexander has been a broker and analyst in the futures business for over thirty years. He is a Vice-President for Sales and Trading at the Zaner Group (www.zaner.com) a Chicago-based futures brokerage firm. If you would like a free booklet explaining the charts mentioned above, email Rick at ralexander@zaner.com.

The information in this Report and the opinions expressed are subject to change without notice. Neither the information nor any opinion expressed constitutes a solicitation by Rick Alexander or the Zaner Group of the purchase or sale of any futures or options. Futures and options trading is speculative in nature and involves risks. Spread trading is not necessarily less risky than outright positions. Futures and options trading is not suitable for all investors.