Wheat futures closed 0.035 to 0.0675 higher in Chicago; 0.03 to 0.045 lower in Kansas City; and mostly 0.02 to 0.08 higher in Minneapolis, although March Minneapolis futures were 0.0525 lower. Futures finished low-range at all 3 exchanges. Wheat started Strong on spillover support from Corn and Soybean, and outside markets, but faced intra-day profit-taking pressure Tuesday
Corn futures gapped higher on the open only to face a midday pullback. But futures worked well off session lows into the close, with March through July futures ending 0.12 to 0.125 higher. Deferred-month contracts posted much lighter gains. Traders returned from their Holiday break optimistic that the lows are in place. Sharp weakness in the US Dollar index spurred widespread buying in the commodity markets Tuesday.
Soybean futures closed around 0.19 higher in the Jan through Aug contracts. Far-deferred futures posted slightly lesser gains. Futures started Strong coming out of the Holiday weekend on support from South American weather concerns and outside markets. While opening gains were initially extended, the market then had to fight intra-day profit-taking and closed near session lows. That could lead to price pressure overnight if support fades.
Cotton futures closed sharply North to its daily 400-pt limit higher on help from positive outside markets. The US Dollar index softened in reaction to positive Global manufacturing data, mainly from China, signaling its economy is expanding. A softer US Dollar triggered widespread buying in the commodity sector, with the Continuous Commodity Index returning above 575.00.
Lean Hog futures closed 0.475 to 1.225 higher, which was near session highs in most contracts. Lean Hog futures were supported by a combination of Strong outside markets and fundamental strength. As a result, traders covered Short positions and some fresh money also entered the long side of the market.
Nearby Cattle futures posted a low-range close. Futures closed 0.10 to 0.575 higher in all but the Apr contract, which finished 0.175 lower. Early support came from a combination of Bullish demand hopes and positive outside markets. Traders are optimistic about further export growth in Y 2012 due to a weak US Dollar and tight Global Red meat supplies. Adding to the optimism is the progress Japan is making on its rule to expand its imports to animals 30 months and younger.
Paul A. Ebeling, Jnr.
Paul A. Ebeling, Jnr
Paul A. Ebeling, Jnr. writes and publishes The Red Roadmaster's Technical Report on the US Major Market Indices, a weekly, highly-regarded financial market letter, read by opinion makers, business leaders and organizations around the world.
Paul A. Ebeling, Jnr has studied the global financial and stock markets since 1984, following a successful business career that included investment banking, and market and business analysis. He is a specialist in equities/commodities, and an accomplished chart reader who advises technicians with regard to Major Indices Resistance/Support Levels.