Beans look to pull up the rest of the grains , in spite of a large 1.533 billion bushel carry in Corn from 2012. The USDA numbers were amazingly close to trade expectations. For the Beans; carry out is a paltry 150 Million bushels 15 below the average trade guess.
As for corn it looks like USDA took usage out of corn. corn carry over advanced from the last crop report. They took out more demand rather than reduce the crop.
The wheat carry over increased. World wheat stock increased 3mmt. Corn stocks world wide advanced. World wide soybean stocks were up 9 million tonnes globally compared to last year.
Managed funds are long. I would imagine funds will be sellers into this market. Key resistance in SX remains the $14.10 level. This hurdle needs to be cleared to attract the momentum traders. We failed there 3 times so far on the charts. A settle above $14.10 would be very bullish.
If you take informa acres from last week and multiply by to today’ s yield, you take the corn crop down 300 million bushels and the beans another 30 million bushels Thursday we will get acres report from the FSA That should move us once again in the price discovery process.
As for the October 13.00 puts, thankfully we only had 7 cents on the table. The beans today had a 50 cent trading range. At 1058 we had traded down to 1341, and we looked poised to fill the gap and test 13.00. When the figures were released we had a 40 cent rally by the end of the day. The option premium is gone, but , we never had an uncontrollable loss. Going into these numbers, options are the best way to play it because you don’t get stopped out.
Typically the day or two after a report is more indicative of what’s really going on once people drill down into the numbers.
As for the Dec Dow futures, we still should see a test of the 12,500 level. December Gold completely hit the skids after 1350 was taken out. Also, a trend line support on the December Gold. Todays’ low was 1324. A test of 1300 seems inevitable, and would be a level I’d step in and buy the first time there.
Here’s a chart of SX. 1410 remains upside resistance;
December Gold Violated a Trend Line Support Today opening up a test of 1300
CER