Instead of turning higher and helping the feed-grains make new highs

12-9-09

GLOBAL COMMODITY ANALYTICS & CONSULTING LLC UPDATE FOR RADIO:

THIS IS MIKE ZUZOLO WITH YOUR WEDNESDAY CLOSING MARKET WRAP-UP:

• Instead of turning higher and helping the feed-grains make new highs, the soybeans were led lower by energies and metals on Wednesday’s trade.

• Jan. Beans fell to its lowest level since Nov. 27, on the heels of crude oil futures falling to its lowest point since early October—and this was even in light of a bullish supply reduction on the weekly stocks data released from the Dept. of Energy. Regardless of this, the crude oil fell to new multi-week lows, which in turn forced the gold to break back below the $1125/ounce level. And with this, the beans gave-way to short-term long liquidation and sell-stops being triggered when the $10.35 level was violated. Fortunately, the Jan. Beans held above its 11/27 low of $10.21—and that’s likely going to be an important number to watch as we head into the last part of the week.

• Even with all the price negativity around them, feed-grain prices held-in there very well, with wheat, rice, and corn finding higher price action on the day in the case of rice or very limited losses on Wednesday’s trade in the case for wheat and corn. For March Corn, even though the high was the 50-day Moving Avg. and it remained a resistance point through the close, the downside was limited after mid-session thanks mainly to the western corn belt weather as well as limited follow-through selling ahead of Thursday morning’s USDA supply-demand report.

• Prices before the Settlement on Wednesday’s Grain Trade: Corn Down 1; Wheat Down 3; and Beans Down 15.

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Abbreviated Risk Disclosure: There is a substantial risk of loss in trading futures and options.

Copyright, 2009 Global Commodity Analytics & Consulting LLC