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MARKET UPDATE - GRAINS, MEATS, SOFTS


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MARKET UPDATE
JUDY CRAWFORD
TRADES FOR TUESDAY, AUGUST 15, 2017
888-301-8120
jcrawford@zaner.com

EMOTION is your enemy more than any market will ever be.

A "RERUN" IN THE GRAINS?It’s August and it seems the bean complex is offering up a rerun of the 2015 mid-year equivalent of a “Saturday matinee.” In that year beans were consolidating as they were earlier this year and in May broke out to the downside. They quickly recovered and in June/July attempted to break out to the upside. They failed and they continued to sell off until they reached their 200 avg. on their monthly chart. At that time it intersected around 850. That is the current bottom to the bean market. This year beans broke out to the downside from consolidation again in May. They quickly recovered and attempted to breakout to the upside. That failed last month. And following the pattern in August 2015, they’ve been selling off. They seem headed for their 200 avg. again on their monthly chart. It currently intersects at approximately 910. But in 2015 from their August high they sold off 143 points. If they do so again, we’re looking at around 857 as a potential.

In 2015 meal had been consolidating, broke out to the downside, turned around to rally and did break out to the upside. It failed and meal peaked in July as well. From its high in August it sold off 77.00 points before finally bottoming around 270. If it does so again, we’re looking at 245.00 meal. But before that is its 200 avg. that comes in around 270.00 which happens to be where they bottomed in 2016.

Bean oil in 2015 sold off to new lows too. But will we see a repeat this time? Probably not. The reason being bean oil made a major bottom in 2015 and has been clearly in an uptrend since. Even though it is selling off this August, in August 2015 it was still in a major downtrend. That is not the case anymore.

So with bean oil being in a more supportive position, one has to ask if this will have an influence in determining the low for both beans and meal. More than likely, yes. The lowest potential targets mentioned above could be limited.

MEATS: The hog rally suggests there is more to it than what we saw today. The beef is back into its previous mode with the feeders stronger than the live. The feeders continued to rally today while the live cattle triggered a sell. How much the feeder strength will influence this sell in cattle remains to be seen. This feeder rally should set up a selling opportunity.

SOFTS: They were all under pressure again today. The selling is not over with yet. Even though sugar was higher I wouldn’t trust a buy yet.


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GOAL OF THE MARKET UPDATE: To understand market behavior while saving time in the process. Everyone is busy and having the technical analysis done for you is helpful plus it is presented in a way that is educational too. What I convey to readers is not a personal opinion but what the markets are suggesting by their technical formations and action.

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GRAINS:

DEC CORN: It continues to hold 370 support. It tested it again today and then rallied to take out Friday’s high. It would reach resistance around 380. Bear in mind when it sold off July 25, that selloff was very comparable to the one it had last Thursday. At that time it did rally after that but all it did was run up to near term resistance and fail. Just watching. Closed 376 1/4, up 1 1/2.

DEC WHEAT: It made a new low and then rallied. It is in long term support. Watching closely. Closed 467 3/4, up 3/4.

NOV BEANS: After a new low today they rallied but not enough to tell you anything. Just watching. Closed 938 1/4, down 6 3/4.

DEC MEAL: It held the best of any in the grain complex. It is trying to hold the 300.00 support. Closed 302.70, down 1.50.

DEC BEAN OIL: It finally went the way of the other grains today. In spite of that, it held well. Watching closely. Closed 33.77, down .22.
Position: Long 34.22 (8.8). Exit 33.58 (8.14). Loss $439 (including costs).



MEATS:

OCT HOGS: Stops were reached Friday. They have continued to rally. They are now back over the 200 avg. on their monthly chart. There could be more to the rally. Closed 69.17, up .55.
Position: Short 67.67 (8.10). Exit 68.77 (8.11). Loss $495 (including costs).
Projection: 65.00.

OCT CATTLE: They triggered a sell today from Friday’s inside day. They continue to trade under their 200 avg. on their daily chart. Earlier downside targets remain intact. Closed 106.60, down .80.

OCT FEEDERS: Stops were reached Friday. They continued to rally today. There is some resistance at 143.00 with stronger resistance up at 145.00. Just watching. Closed 142.32, up .72.
Position: Short 139.95 (8.10). Exit 141.50 (8.11). Loss $830 (including costs).
Projection: 136.40.

SOFTS:

DEC COTTON: After trying to form a reversal bottom on Friday, cotton made a new low for the move today. It has failed a 61.8% fib. retracement of the entire rally since the July 14 low. It is sitting in support today. On its monthly its 200 avg. intersects at 67.20. That’s good support. Cotton violated that support in June and July but closed way above it. Its monthly has a buy signal and its weekly chart is triggering a sell this week. That suggests to me that this selloff is not over with yet, but that it should be an opportunity to buy. On its weekly chart. 67.30 is where its 100 avg. intersects so for now I would watch how it behaves around 67.30 to 67.20 for a potential buy. Watching closely. Closed 67.75, down .50.

SEPT ORANGE JUICE: It has been bottoming technically and remains so. It is most likely headed for its 20 avg. on its weekly chart up at 139.75. Just watching. Closed 136.05, down .05.

SEPT COFFEE: It has started to sell off last time but was holding at the usual support that has held all other selloffs on its daily chart. I suggested that this selloff could be more extended because of the reversal top forming on the weekly chart along with the resistance issues on its monthly chart. The reversal top on the weekly chart did not materialize. But so far a more extended selloff is occurring. Today it violated that “usual support” on its daily chart. And it is forming a preliminary reversal top on its monthly chart and is back under the 100 avg. on its weekly chart. There should be more to this selloff. Closed 136.95, down 3.35.

DEC COCOA: Switching to December. It failed its 100 avg. on its daily chart last Thursday. An inside day on Friday triggered a sell today. It appears headed for 18.50 support again. Just watching. Closed 19.20, down .57.

OCT SUGAR: Sugar is attempting to hold the June low on its daily chart. Just looking at all the charts, it is a toss-up whether that will hold or not. Best just to watch. Closed 13.50, up .30.


Trading commodity futures and options involves substantial risk of loss and may not be suitable for all investors. You should carefully consider whether trading is suitable for you in light of your circumstances, knowledge and financial resources. Opinions are subject to change at any time and are a solicitation or recommendation to buy or sell futures contracts or options on futures contracts. The information contained in this message has been obtained from sources believed to be reliable but is not guaranteed as to its accuracy or completeness. All known news and events have already been factored into the price of the underlying commodities discussed.

Past performance is not indicative of future results. All suggested trades are based on technical signals/indicators and do not include slippage or cost. Not all trades suggested are taken. Results are based on what the signal indicates not necessarily an actual trade. Actual results may vary.

Futures, options and forex trading is speculative in nature and involves substantial risk of loss. These recommendations are a solicitation for entering into derivatives transactions. All known news and events have been factored into the price of the underlying derivatives discussed. From time to time persons affiliated with Zaner, or its associated companies, may have positions in recommended and other derivatives.



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Toll Free Number:  888-301-8120; 312-277-0133.  jcrawford@zaner.com

BACKGROUND ... Thirty years experience as a commodity broker has given me an insight into the needs of traders that only comes with experience. Originally from Minnesota, I started my career as a stockbroker in New York but moved to Chicago, the center for the commodity industry. I have found that no matter where a client lives in the world, all traders have the same needs.

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