What’s Up, What’s Down: Spotlight on Grains
Comments for February 16, 2011
Looking ahead to Wednesday by reflecting back on Tuesday’s trading
Futures and options trading is speculative in nature and involves substantial risk of loss. Futures and options trading is not suitable for all investors
GRAINS CLOSE DOWN SHARPLY, BUT IS THE LONGTERM TREND STILL BULLISH?
GRAINS: 2/16/11: Lower to sharply lower closes yesterday for Minneapolis, Kansas City and Chicago wheat along with corn, oats, rough rice, soybeans, soymeal and soyoil. The wheat complex was hurt technically by Tuesday’s action in my opinion but are still in strong longterm uptrends. Minneapolis had its worst low and close since February 1st and needs to hold the 960(Mar) area. KC needs to hold 920(Mar.and Chicago(828) with the latter having good support between 750 & 800. Rice closed down the 50 point limit which is not a rare for this commodity. I’m now near a possible sell signal. Oats made their worst low and close in two weeks but has very strong support between 375 & 400 (Mar.). Corn went sharply lower but had a strong rally in the last hour to settle 10 cents off its session’s low still in a strong longterm uptrend with good support down around the 440 to 460 (Mar.) area. This was a follow through from Monday’s reversal type action.The bean complex closed sharply with beans making its lowest low and close since January 11th.The March contract needs to not close below 1350 in my opinion. Meal also had its worst low and close since January 11th with 360 (Mar.) a critical area to hold in my opinion. Oil had its lowest low and close since January 25th with 5570 (Mar,) important to watch. I feel the correction for the grain complex was overdue and should lead to a more orderly uptrend, with the possible exception of rice, in the near future assuming the uptrends prevail. BUY SIGNALS FOR OATS, CORN, SOYBEANS, SOYMEAL, SOYOIL, MINNEAPOLIS, KANSAS AND CHICAGO WHEAT.
I have the early closing and holiday trading hours schedule for Friday, February 18 – Monday, February 21 for President’s Day, posted at my website: https://www.zaner.comn/3.0/market_information/hot_topics.asp
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. Email Rick at ralexander@zaner.com or call toll-free (888) 281-4158.
Futures and options trading is speculative in nature and involves substantial risk of loss. Futures and options trading is not suitable for all investors. The information in this Report and the opinions expressed are subject to change without notice. All known news and events have already been factored into the price of the underlying commodities discussed.