Why Corn Was Impressive Today

Technical Outlook

BONDS (DEC) 11/28/03: It is a slightly negative indicator that the close was lower than the pivot swing number. Near-term resistance for bonds is at 110.22 and then again at 111.11, while swing support hits at 109.23 and below there at 109.13. The market’s close below the 9-day moving average is an indication the short-term trend remains negative. The daily stochastics have crossed over down which is a bearish indication. Daily stochastics turning lower from overbought levels is bearish and will tend to reinforce a downside break especially if near-term support is penetrated. The next downside target is 109.13.

T-NOTES(DEC) The daily stochastic’s gave a bearish indicator with a crossover down. Momentum studies are trending lower from high levels which should accelerate a move lower on a break below the 1st swing support. The next downside objective is now at 112.16. It is a mildly bullish indicator that the market closed over the pivot swing number. The major trend is down with the cross over back below the 40-day moving average. Near-term resistance for the T-Notes is at 113.12 and then again at 113.28, while swing support hits at 112.22 and below there at 112.16. The market’s short-term trend is negative as the close remains below the 9-day moving average.

STOCK INDICES RECAP

11/26/03

The stock market managed an early rally but then faltered at mid session possibly because of some terrorist rumors. Apparently the trade circulated stories that some New York subway workers were being treated for respiratory distress and that prompted traders to bank some profits. We also have to think that a large portion of the recent buying was done by players expecting a pre-Thanksgiving rally and that those traders simply decided to bank profits. Regardless of the price action it was clear from the US numbers that the economy is better than what the stock market has been giving credit for.

Technical Outlook

S&P500 (DEC) 11/28/03: It is a mildly bullish indicator that the market closed over the pivot swing number. The upside closing price reversal on the daily chart is somewhat bullish. Underlying support comes in at 1051.30 and 1043.95, with overhead resistance at 1061.90 and 1065.15. The market’s short-term trend is positive on a close above the 9-day moving average. Momentum studies are trending higher from mid-range which should support a move higher if resistance levels are penetrated. The near-term upside objective is at 1065.15.

S&P E-Mini (DEC): The daily closing price reversal up is a positive indicator that could support higher prices. Stochastics are at mid-range, but trending higher which should reinforce a move higher if resistance levels are taken out. The next upside objective is 1065.94. The market has a slightly positive tilt with the close over the swing pivot. Near-term resistance for the S&P Mini is at 1062.13 and then again at 1065.94, while swing support hits at 1050.88 and below there at 1043.44. A positive signal for trend short-term was given on a close over the 9-bar moving average.

NASDAQ (DEC) The daily closing price reversal up is positive. The market’s close above the 9-day moving average suggests the short-term trend remains positive. It is a slightly negative indicator that the close was lower than the pivot swing number. The market should run into resistance at 1430.50 and above there at 1443.25 with support at 1402.50 and 1387.25. Positive momentum studies in the neutral zone will tend to reinforce higher price action. The next upside target is 1443.3.

CURRENCY MARKET RECAP

11/26/03

After the action Wednesday one has to wonder what set of circumstances would serve to rally the Dollar. With US numbers coming in very strong and the outlook for US recovery becoming much more secure one would have expected the Dollar to avoid a 100 point decline. Furthermore, it is clear that the US growth pace is significantly above other key areas but yet the Dollar remains out of favor. It is therefore likely that the US Administration is driving the Dollar down in an effort to get the Chinese to change policy. The strongest up trends against the Dollar appear to be the Pound and the Canadian.

Technical Outlook

YEN (DEC): The market’s close below the 9-day moving average is an indication the short-term trend remains negative. With the close higher than the pivot swing number, the market is in a slightly bullish posture. Swing resistance is targeted at 92.05 and above there at 92.34, with the yen finding support around 91.32 and below there at 90.88. Negative momentum studies in the neutral zone will tend to reinforce lower price action. The next downside target is 90.88.

EURO (DEC): The daily stochastics gave a bullish indicator with a crossover up. The near-term upside objective is at 1.2046. The market is in a bearish position with the close below the 2nd swing support number. Swing support for the Euro comes in at 1.1738, with overhead resistance at 1.2046. The market’s short-term trend is positive on a close above the 9-day moving average. The gap down on the day session chart is bearish with more selling pressure possible today.

PRECIOUS METALS RECAP

11/26/03

The gold market saw the best of two worlds Wednesday with US economic numbers very strong and a weak Dollar. We also think that a rumor about a possible terrorist incidence in the New York Subway provided the market with a surprise lift. In any regard, the gold market has to be left in a very bullish position following the action Wednesday but traders should be aware that metals are closed for Thursday and Friday and that fresh fundamentals conditions might prevail into the opening Monday. If the US Dollar manages to forge a new low for the move into the opening Monday that could catapult the gold market quickly into new high ground next week.

Technical Outlook

SILVER (MAR): With the close higher than the pivot swing number, the market is in a slightly bullish posture. Initial support for silver is at 533.5 and below there at 528.0 with resistance likely at 538.4 and 543.0. The market’s close above the 9-day moving average suggests the short-term trend remains positive. The daily stochastics have crossed over up which is a bullish indication. The next upside target is 538.4.

GOLD (FEB): Support for gold today comes in near 388.50, while resistance is pegged at 406.90. Momentum studies are trending lower from high levels which should accelerate a move lower on a break below the 1st swing support. The next downside objective is now at 388.50. The market’s close above the 2nd swing resistance number is a bullish indication. The market’s short-term trend is positive on a close above the 9-day moving average. The rally brought the market to a new contract high.

COPPER MARKET RECAP

11/26/03

The copper market certainly got a strong helping of favorable macro economic developments Wednesday and even managed to rally in the face of a sloppy US equity market. It would seem that many US traders were afraid that China would run prices up on them (with the market being closed for the rest of the week) and therefore, the market probably has some fresh buying by the Chinese factored into prices. Codelco did suggest Wednesday that they might release 200,000 tons of copper because their internal stocks were reaching a lofty level of 800,000 tons. The Codelco release didn’t really serve to upset the market Wednesday so it could be an unimportant development.

ENERGY MARKET RECAP

11/26/03

The weekly inventory stats were very supportive to crude and heating oil as crude stocks declined by almost 5 million barrels. While there were slight builds in the gasoline stocks those figures are less important. As it stands, the supply situation should be tight enough to make last week’s lows extremely solid lows. In fact, given recent upward adjustments in demand forecasts from the EIA and the significantly improved US economic outlook we have to think that last weeks lows should be considered cheap pricing. The energy complex is closed Thursday and Friday of this week!

Technical Outlook

CRUDE OIL (JAN): With the close over the 1st swing resistance number, the market is in a moderately positive position. Support for crude is keyed on 29.96 and below there at 29.60, with resistance pegged at 30.48 and 30.64. The market’s short-term trend is negative as the close remains below the 9-day moving average. Momentum studies trending lower at mid-range should accelerate a move lower if support levels are taken out. The next downside objective is now at 29.60.

UNLEADED GAS (JAN): Negative momentum studies in the neutral zone will tend to reinforce lower price action. The next downside target is 80.69. With the close higher than the pivot swing number, the market is in a slightly bullish posture. Resistance today is at 83.99, while support should be found around 80.69. The market’s close below the 9-day moving average is an indication the short-term trend remains negative.

HEATING OIL (JAN): With the close over the 1st swing resistance number, the market is in a moderately positive position. Heating oil should encounter support around 82.03, with resistance is at 85.43. The market’s short-term trend is negative as the close remains below the 9-day moving average. Momentum studies trending lower at mid-range should accelerate a move lower if support levels are taken out. The next downside objective is now at 82.03.

CORN MARKET RECAP

11/26/03

The corn market mounted an aggressive rally Wednesday possibly because of a surprise cash sale which is supposed to take place later this week. In other words, the trade still thinks that the US is set to get some additional sales into the Pacific Rim at the expense of China. It should also be noted that the trade is also hopeful of some Russian corn interest and that simply pushes the demand outlook into the bull camp. There were also reports of aggressive fund buying in the action Wednesday and that might be a factor that helps extend gains in the coming sessions. Weekly export sales, released before the opening, are expected to come in near 600,000-900,000 tons as compared with 917,100 tons last week.

Technical Outlook

CORN (MAR) 11/28/03: Momentum studies are trending higher from mid-range which should support a move higher if resistance levels are penetrated. The near-term upside objective is at 249 3/4. The market’s close above the 2nd swing resistance number is a bullish indication. Market resistance comes in at 249 3/4 today, with support at 243 3/4. The market’s short-term trend is positive on a close above the 9-day moving average.

SOY COMPLEX RECAP

11/26/03

The soybean market mounted an impressive technical reversal against the recent down trend action but some traders suggested that the action was book squaring. It is also possible that the trade feared that the Chinese might buy some beans on a day in which the US market was close and decided to extend some forward coverage. The trade was evidently willing to largely ignore a Chinese fungus problem and suggest that Chinese soybean supplies are enough to meet internal needs. Therefore, it is clear that the bear camp still feels strongly about its case. Weekly export sales, released before the opening Friday, are expected to come in near 1.0-1.5 million tons, as compared with 714,100 tons last week. Meal sales are thought to be near 40,000-80,000 tons and oil sales at 3,000-8,000 tons.

Technical Outlook

SOYBEANS (JAN) 11/28/03: The downside closing price reversal on the daily chart is somewhat negative. With the close higher than the pivot swing number, the market is in a slightly bullish posture. The next area of resistance is around 750 1/2 and 755 3/4, while 1st support hits today at 741 and below there at 736 3/4. The market’s close below the 9-day moving average is an indication the short-term trend remains negative. Momentum studies are declining, but have fallen to oversold levels. The next downside target is 736 3/4.

MEAL (JAN): Daily stochastics are trending lower, but have declined into oversold territory. The next downside objective is now at 224.8. First resistance comes in at 228.3, with support at 226.1. The market’s short-term trend is negative as the close remains below the 9-day moving average. It is a mildly bullish indicator that the market closed over the pivot swing number.

BEAN OIL (JAN): The market’s close below the 9-day moving average is an indication the short-term trend remains negative. The daily stochastics have crossed over up which is a bullish indication. The next upside target is 27.01. With the close higher than the pivot swing number, the market is in a slightly bullish posture. Daily swing resistance is found at 26.78 and above there at 27.01. Support should be encountered at 26.44 and 26.33.

WHEAT MARKET RECAP

11/26/03

March wheat experienced choppy, two-sided trade on Wednesday ahead of the holiday with low volume trade. Talk of the potential for heavy deliveries and profit-taking after solid gains on the week kept the trade choppy. Friday is first notice day. The market found support from a USDA announcement that 210,000 tons of wheat was sold to unknown destination. Rumors of demand from Russia and Eastern Europe added to the positive tone. Weekly export sales, released before the opening, are expected to come in near 500,000-700,000 tons as compared with 1.095 million last week. Traders are looking for 500-1000 contracts for delivery on first notice day with one estimate heard at 2500.

Technical Outlook

WHEAT (MAR) 11/28/03: The downside closing price reversal on the daily chart is somewhat negative. With the close higher than the pivot swing number, the market is in a slightly bullish posture. Look for near-term support at 394 1/2 and below there at 390 3/4, with resistance levels at 402 and 405 3/4. The market’s close above the 9-day moving average suggests the short-term trend remains positive. Negative momentum studies in the neutral zone will tend to reinforce lower price action. The next downside target is 390 3/4.

LIVE CATTLE RECAP

11/26/03

Cattle closed sharply higher led by the nearby December futures with cash trade at $100 this week helping to drag the market up and sent shorts covering. There were indications that short hedgers in December were lifting positions again with December holding a stiff discount to the cash market. In spite of indications that packer profit margins are deep in the red, the higher than expected slaughter this week indicates that packers are in need of cattle in order to fill near-term needs. Boxed-beef cut-out values were down $.15 to $161.82 as compared with $166.34 last week at this time.

Technical Outlook

CATTLE (FEB) 11/28/03: The daily stochastics have crossed over up which is a bullish indication. The next upside target is 93.55. With the close higher than the pivot swing number, the market is in a slightly bullish posture. Support should be encountered at 92.27 and below there at 91.65. Market resistance is at 93.22 and then again at 93.55. The moving average crossover down (9 below 18) indicates a possible developing short-term downtrend.

LEAN HOGS RECAP

11/26/03

The market closed mostly lower on the session with December hogs into new contract lows but February managed to hold on rollover support as longs were rolling out of December futures. Cash hogs were expected to be lower but Peoria came in $1.00 higher. The 2-day lean index was down 13 points to 49.25 as compared with 49.21 last week at this time. Weekly average weights for Iowa/Minn for the week ending November 22nd came in at 266.1 pounds, up .4 pounds from the previous week and from last year. The high slaughter pace and still high weights would suggest that producers are still not current with marketings. Bellies were under light selling pressure from the bearish weekly cold storage report.

Technical Outlook

HOGS (FEB) 11/28/03: It is a mildly bullish indicator that the market closed over the pivot swing number. Resistance levels comes in at 53.50 and 53.85 today, while support is around 52.92 and then 52.70. The market’s short-term trend is negative as the close remains below the 9-day moving average. Daily stochastics are trending lower, but have declined into oversold territory. The next downside objective is now at 52.70. With a reading under 30, the 9-day RSI is approaching oversold levels.

COCOA MARKET RECAP

11/26/03

The cocoa market managed a slight short covering bounce as the trade attempted to balance positions ahead of an extended holiday. The New York Cocoa market is closed Thursday and Friday of this week due to holiday. Therefore, shorts might have been concerned about holding positions with the market closed and London open. The sentiment in the market would seem to remain in the bear camp with the expectation of more physical supply flow and possibly more small spec and fund selling.

Technical Outlook

COCOA (MAR)12/1/03 The daily closing price reversal up is positive. The market tilt is slightly negative with the close under the pivot. Cocoa should run into resistance at 1453 and above there at 1464 with support at 1423 and 1404. Negative momentum studies in the neutral zone will tend to reinforce lower price action. The next downside target is 1404.00.

COFFEE MARKET RECAP

11/26/03

While coffee prices mounted a minor rally Wednesday the action wasn’t that impressive. After such massive losses in November it is not surprising that the market sees some month end booking squaring. It should be noted that Coffee will be closed on Thursday and Friday of this week. In the face of fund short covering the trade reported origin selling and that would seem to limit the near term upside in coffee. There simply isn’t much supply uncertainty and that is what the market needs to bottom. Brazilian exports for the majority of November continue to run behind year ago levels but that probably isn’t enough to cause a broad based change of sentiment.

Technical Outlook

COFFEE (MAR)12/1/03 The market setup is supportive for early gains with the close over the 1st swing resistance. The daily stochastics have crossed over up which is a bullish indication. The near-term upside objective is at 61.35.The Coffee contract should run into resistance at 61.00 and above there at 61.35 with support at 60.25 and 59.85. The market’s short-term trend is negative as the close remains below the 9-day moving average.

SUGAR MARKET RECAP

11/26/03

Rumors that China bought some sugar in the raw market provided the bull impetus Wednesday. We also have to think that some traders were looking to cover shorts after the recent decline and because of month end book squaring. The Sugar market is closed for the rest of the week and that might also have prompted the shorts to exit. It is remotely possible that macro economic improvements gave the shorts a little added incentive to exit sugar.

Technical Outlook

SUGAR (MAR) 11/28/03: The market’s close above the 2nd swing resistance number is a bullish indication. Swing resistance comes in at 6.41, with support found at 6.07. The market’s short-term trend is negative as the close remains below the 9-day moving average. The major trend could be turning up with the close back above the 40-day moving average. Momentum studies trending lower at mid-range should accelerate a move lower if support levels are taken out. The next downside objective is now at 6.07.

COTTON MARKET RECAP

11/26/03

A slowdown in the fund long liquidation selling and talk that the China cotton buying delegation is still expected to visit Memphis next week helped drive the market sharply higher and to limit-up. The lack of new sellers after the slightly higher opening turned the trade aggressive buyers which quickly drove the market to limit-up. Weekly export sales, released on Friday when the market is closed, are expected to come in near 200,000-500,000 bales as compared with 527,000 last week. The cotlook A Index was down 200 to 71.55 and was down 520 on the week. Mill use in October was pegged at a seasonally adjusted rate of 6.12 million bales as compared with 7.48 million last year. This was in line with trade expectations.

Technical Outlook

COTTON (MAR) 12/1/03: The market’s close below the 9-day moving average is an indication the short-term trend remains negative. A positive setup occurred with the close over the 1st swing resistance. Next resistance area comes in at 71.51 and then again at 72.22, while support is targeted at 68.67 and 66.54. The daily stochastics have crossed over up which is a bullish indication. The next upside target is 72.22.