GENERAL
GENERAL
A few general thoughts that reflect my opinions. EQUITIES – The market is lower today, but bouncing off the recent lows. It is my opinion as I sit here today that nothing fundamentally has changed for the positive. To the contrary, rates are just starting up. The housing market is slowing. And, the energy prices, at the very least, are creeping higher. The point is that the equities may rally a bit further. It is my opinion this is a bounce in a bear market. It is my belief the Bear will rule until Biden is out of office. ENERGY – The Crude market continues to be supported above 115. The 120 level is offering resistance. I am not trying to predict exact prices here. The market continues to move up on the US policy, Period! It is clear the global dynamic remains in flux, also price supportive. It is my thought that the market will witness volatility. The reality remains until something changes, objects tend to remain in motion. The energy price has a macro effect on the Global Economy. METALS – The gold and silver both are in retreat and defensive. The interest rates are a reason this could in fact be happening. The calls for inflation buying have yet to materialize. The Silver in my opinion is reaching levels that could offer some support. However, the technicals do not at present call for a buy. FIXED INCOME – The monetary policy is the driver. The market has had a significant break. This is driven by the start of rates going up. Due to certain slowdowns, the housing, etc, the market may pause here and have a relief rally. It is probably due. However, it is my thought that this is a rally in a bear market, if in fact it transpires. The Fed is between a rock and a hard place. That is why I am not sure raising rates, while appropriate, will give the expected outcome. There are to many pieces of the puzzle that are out of sorts. In addition, the Fed has a huge deficit to pay for. The higher rates are difficult to the national payments. It is odd then that we continue to propose more deficit spending. This is the second time in history. First I think that is not related to War Spending. I suppose that will be the next offer from the ADMIN. Its Putin’s Deficit.
SOY
The beans rebounded slightly today. The progress yesterday is showing close to normal. The weather overall is good. In my opinion the participants want to be bullish. The crude market is pulling veg oil prices higher. The oil share is 48.5 %. The crush margins are 87 cents. Both are promoting domestic use. This is supportive. The market should watch the South American harvest at present as it wraps up. The Global demand will be important as well as geo political bents. I have little thoughts today.
CORN
The corn remains under pressure. The domestic market is under pressure as the progress has all but caught up to normal. The north remains behind. The Black Sea offering feed grains is weighing on corn prices as well. The long term thoughts of Brazil supplying more corn to the Chinese market is also weighing. The Corn at present is close to a nearby support in my opinion. At which point the market should look at the long term weather. The global outlook and then decide which direction to go.
BE WELL,
John J. Walsh
President, Walsh Trading, Inc.
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