What’s Up, What’s Down: Soy Complex Settled Sharply Lower

Comments for Friday, December 18, 2009

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


Lower to sharply lower closes yesterday for corn, soybeans, soy meal, soy oil, oats, rough rice, Minneapolis, Kansas City and Chicago wheat due to the sharp rise in the dollar and lower energy prices. All of the wheat made new recent lows and closes with KC and Chicago settling below decent support areas! The March corn contract rallied over 413 in the night session but ended up at 397 due to the sharp rally in the dollar and lower energy prices as mentioned above. In fact the dollar and energy caused most futures markets to settle lower. Corn has been trading between 375 and 425 since around October 9th with no true direction yet which is why I’m still taking a neutral stance for now. Rice settled sharply lower again this time down 56 cents due to expanded limits giving me a SELL SIGNAL and close to ending its up-trend overall. That didn’t take long! Oat made its highest high in a week overnight before closing lower like the rest of the grains due mainly to what I said above. Now we’ll have to see if that’s the end of its retracement rally. The bean complex settled sharply lower with the beans now giving me a SELL SIGNAL. Meal is in a good support area with my buy signal still intact while oil gave me a SECOND SELL SIGNAL.  Sell Signals for Wheat and Oats. Please feel free to contact me for details.

Rough Rice Chart

Oats Chart

Soybean Chart

Soybean Oil Chart


Higher settlements Thursday for live and feeder cattle but lower for lean hogs and pork bellies. The cattle/ hog spreads have been working for a week which has helped cattle rally and hogs drop. Cattle settled lower today but has been bouncing off the resistance area over 8500 and has now formed a BULL PENNANT which should signify the rally isn’t yet over, it at all. My sell signal, however, is still in place and the long-term trend is down so new shorts can be added up to 8600 basis the February contract. Call for details. Also, cattle could be forming a potential bottom. The feeders look better helped by a record-looking corn crop and are close to breaking out to the upside. I’ve also removed my sell signal due to the close of the January contract above 9395. Hogs made a new recent high before settling lower in reversal type actions but still very bullish overall. Bellies had a huge range before settling lower but giving me a BUY SIGNAL for all of you brave folks on Tuesday.

Live cattle Chart

Feeder Cattle Chart

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.