March 4th, 2009 Posted in Uncategorized
Across the board we're seeing gains today in most commodity futures. Grains, oilseeds, softs, meats, dairy, & energies are all enjoying a bounce. Presently, gold and the US Dollar are falling back, though modestly so. Hard to fade the enthusiasm for the day as a look at the stock index futures shows the bulls in charge for now ... yet we'll see how it chooses to close.
There are a number of opportunities setting up as I see them. The short side of the equity futures looks like a reasonable proposition, though patience for more of a bounce will probably skew the reward:risk more in our favor. As for the meats, the fundamentals of the feedlot & remaining cattle inventory sure look bullish if we can get past the cloudiness that is the economy and the perception that consumers will be shunning higher-priced beef for awhile (though grilling season is just a few months away for us Northerners!).
Old crop soybeans have been in demand, but with Brazil's harvest underway and Argentina's harvest yet to come, competition may soon be on its way. Wheat appears plentiful, but the winter wheat crop needs a drink or two in order for it to meet its potential. We have a monthly USDA crop production report on Wednesday, March 11, and then the "big one" will be the planting intentions report that comes out at the end of the month. The planting intentions report is a report that gives an idea of how much acreage will be planted to soybeans, wheat, corn, cotton, etc.
Save for natural gas, energy futures are continuing to move higher for the second day in a row. The recent test near contract lows for crude oil and heating oil was met with good support, and along with a rising equity market the energies have been able to pop higher. April crude is +5.00/bbl from its lows yesterday, roughly an 8% gain.
There are many more interesting market movements, and the bottom line will be to craft some good trading strategies to wring every dollar out of the market that we can when we are right, and limit losses when we are dead wrong. I'll be back soon with some trading ideas...
Bob