SOY
The beans are charging ahead over the last few sessions. The thoughts are the clearing weather in the Midwest will not add more bean acres. This may or may not be true. The recent Chinese purchases are also a supportive factor. The market is hoping for and anticipating more. Also helping beans is the recent strength in meal. Moving forward the beans will watch the northern growing areas, Dakotas, Minnesota for any further rain. The story also is turning into a spread situation. Both the July/August and the July/November are starting to break out above the 14 day high. This can be an early indicator, however no guarantees. If demand in nearby position stays strong look for these spreads to remain bid. Trade with a quantified risk, stop, etc.
MEAL/OIL
The meal has made gains of late. The global meal market reached a point where demand started to show up. In addition the meal relative to corn was viewed as cheap on a relative basis based on cost of Protein. The meal in the nearby position should remain supported. The recent rally has pushed the market into an area of resistance. Perhaps a more back and forth trade will ensue. The bean oil market has been supported by friendly fundamentals. Also friendly for all oils. The palm oil price is now a discount to bean oil. This is important going forward. The volatility, however, will remain high. The Canola and sun oil prices are not yet coming under pressure. It is however my thought that the oil share can start to ease a bit. This remains to be seen. Exercise caution.
BE WELL,
John J. Walsh
President, Walsh Trading, Inc.
800-993-5449
312-208-8836
jwalsh@walshtrading.com
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