4pm Chicago time.. Story of the day was long liquidation in the wheat, with Dec settling 23 cents lower on the day … and below the technically significant 450 level.. A lot of pros were actually looking for a settlement higher this week, but once again, the market spoke today, as we saw selling of wheat and corn with buying of beans against it.. Nov beans settled just above 926, close to the 925 strike price, up about 6 cents.. For a bit in the afternoon, it looked like beans would roll over under the pressure from the corn and wheat, but the 921 level held and beans rallied in the final 2 minutes of trade.
Crude was largely unchanged right at 66 bucks, while the gold and silver markets were both down. Top step gold settled well below the 1000 level with Oct at 990, while Sep silver bounced off the key 16 dollar level although settling at 16.038.. I imagine technical traders will take a look at these charts this weekend and re=evaluate any weak long positions.
It remains to be seen if the us dollar will continue to strengthen slightly against the rest of the world’s currencies…
However, I did get a warm fuzzy feeling reading Jim Rogers opinion that he sees the Chinese yuan replacing the us dollar eventually as the world’s currency of choice. He has a great track record, but is generally early on his big ideas…
A weaker dollar will mean inflation which means quantitatively higher commodities prices are long term on the horizon.
Apparently leaving interest rates at zero is detrimental to the value of a country’s currency.. Important safety tip for the next head of the fed.. However, the alternative to these interest rates, is 1929, when the fed actually raised rates, exacerbating the already bad economic situation.
All things being equal, government will welcome some inflation back into the sails of the ship. Artificial wind is better than sitting in the ‘irons’ so to speak, waiting and trusting in the business cycle..
At some point, believe it or not all ye perma bears, the US economy will rebound, interest rate hikes will be dialed into the system, and there will be a return to a traditional yield curve.
Sunday night’s opening should be interesting, depending on where and if there is anything put into the weather forecast suggesting an early killing freeze. Although, reports of the beans dropping leaves, suggests its relatively late in the growing cycle.
True weather bulls needed a hard freeze about ten days ago, and it never materialized.
If Nov beans can rally above the 934 level, 950 to 953 3/4 looks very reachable.. Wheat and corn could actually help spur any weather related rally, simply b/c of the amount of spreading done today focused on selling wheat and corn against the beans… A true weather issue in the beans would feed on the sympathetic short covering in the corn and wheat.
We’ll just have to wait and see…
Have a great weekend..
CER