Yesterday the market saw a solid upside effort following more downside pressure overnight. The spark came from wheat again with paper buying back short 750c all session. Major volume seen buying the WZ 750-800 call spread as paper looks to defer risk to higher strikes. This was the building point for the whole floor with corn gaining momentum on talk of China selling CZ 550p with interest in buying the CZ 580-610 cs paying 8.5-9-cents. This is another method to defer risk to a higher strike hoping time erodes quickly enough. The bean complex was relatively quiet outside of heavy volume in the X/F spread as market participants get ready for FND on Friday. This adds to the possible chaos on the last day of the month. The feel was one of fundamentals beating macros with daily charts looking to the upside for the first time in a week.
The overnight session continued the day session momentum as all markets moved higher led by wheat. The weakness in the USD is the contributing factor. The day session will open in line or stronger with export sales supporting beans with China buying the whole kit and caboodle. Their appetite is ravenous with the US now over 65% of total USDA expectations for exports in only the first quarter.
I posted my first Inner Circle trade recommendation for GrainAnalyst.com Premium Subscribers yesterday, a spread in the beans for producers. I will be researching trades for both sides of the market, producers and consumers, as well as for spec trading and hedging. There will be something for everybody!
I will be off the floor on Friday so have a great weekend, everyone!
