The stronger Globex market from overnight isn’t what we saw today when grains opened

12-11-09

GLOBAL COMMODITY ANALYTICS & CONSULTING LLC MID-DAY GRAIN UPDATE:

GOOD DAY EVERYBODY, HERE’S THE LATEST AT THE MERC AS WE HEAD INTO THE MID-DAY SESSION:

• The stronger Globex market from overnight isn’t what we saw today when grains opened, and this is most likely a result of a better than expected Retail Sales report pushing bonds sharply lower and this in turn pushing the Dollar sharply higher—in fact, the Dollar Index has re-taken its 50-day Moving Avg. for the 1^st time since this spring on a closing basis.

• The sharply higher Dollar has pushed gold and crude negative on the day and this likely hit the grains on the opening as well, with wheat down actually down slightly after the opening bell.

• As we head into mid-day trade, the grains have all turned back positive but not by much: it’s likely going to be a rough road here for the rest of the day unless the beans turn the rest of the market higher. Not only were the beans the strongest in the overnight trade, but another 232,000 tonnes of US exports to China was announced before the opening this morning. This puts the beans in the position as leader to the upside in my view, and I’d like to see last night’s overnight high of $10.39 taken-out today; if this can happen, then the corn should follow suit. I’ll also be watching the Jan. Crude 200-day Moving Avg. of $69.65 area, since we’ve tested it today.

THIS IS MIKE ZUZOLO, AT GLOBAL COMMODITY ANALYTICS—VISIT WWW.GLOBALANALYTICS.BIZ FOR MORE INFORMATION AND MARKET ANALYSIS.

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