Today we saw the USDA stocks report offer slightly bearish momentum for beans with corn possibally supportive had we not rallied so significantly. Wheat production is slightly bearish and would drag the market lower had wheat not already collapsed.
Month end will bring more action to the table than the report with the trade looking at inflated corn prices as farmers cash in on a hefty basis rally due to small harvest delays.
The bean corn spread is a bit too tight for many and will be a focus moving forward. Couple this with wheat corn approaching $1.00 and we again have interest in flat price spreads.
Overall look for a slightly weaker market across the board with macros looking to pull the AG markets higher with both crude and the Euro higher to start.

Egypt is in the market today looking for at minumum 55 TMT option origin wheat. This is expected to come through during the session so watch the wheat market for any major shift in price with this tender expected to skip the US but we do have a much better chance than in past months.

The market is mixed to slightly higher across te board with early momentum in wheat backing off while corn holds small gains. Beans are slightly lower on harvest pressure with cornsure to feel the same as the week progresses. Volatility is lower to start the week with corn backing off by 1.5% now at 35.5%. Thiss a good indicator of things calming down heading into month end on Weds.

On a personal note, I’m ashamed of my Alma Mater, ILLINOIS, following their disasterous effort this past weekend on the gridiron…three first downs, really?!?!?!?!

Crude Still drifting lower here down to $66 as the USD rallies.  $65 is the next support here and if we can break that $62.50 could be in the near future.  It has been pretty volatile the last few days to say the least.

The USD fought back toay against the Euro to trade at $1.4630 which is about 2 pennies lower than where we saw this relationship at to start the week.  Gold traded beow $995 and Silver got down to $16.  Copper got hit hard today as the equity markets were down leading to a 10 cent fall back.  Alot of investors have taken profits over the last few days here.  We will see if this continues but a good buying opportunity would be had right now.

Many eyes will be on RIMMs earnings and new home sales over the next few days. The question is can earnings and positive housing numbers really stimulate the stock market? Small resistance to 1100 but after that a clear road to 1200. The only problem is the market rose to fast and a normal pull back may be in order; 3-5% has been the norm in previous instances. We need a strong bullish or bearish market to day trade!

I couldn’t write a daily wire today due to my dealings with the dreaded brokerage error. I have been fighting the good fight all morning trying to save a buck…to no avail, ouch thats painful.

Todays market will move slightly lower with beans looking to lose the most. Exports were mildly supportive with beans over 1.0 MMT but we only shipped 83 TMT showing that China is backed up if not lessening their long term interest.

Wheat volatility surged yesterday duet o big buying in the WZ 500c with paper buying 5,000 on the day. Corn vol maintains an inflated level and its justified at least for the time being. I continue to be a corn vol bear while looking at buying bean volatility.

MPI

The USD has recently fell onsome hard times as the inflation pressures near.  The Euro/USD trades at a $1.4800 level and has risen to its highest point for the 2009 year.  This is leading investors to rush in to Gold, Silver, and Platinum as an alternative investment to the greenback.  Gold has now breached $1,025 and looks to be a great buy onany pullback in the high $900’s.  PLatinum has broken the triple top of $1,300 and is heading higher.   Silver wants to try and break the $18 barrier.  Even as ht market rallies these metals head higher, something we have not seen in times passed.  This rally needs to be looked at seriously.

Oil got absolutely hammered today as inventories rose in Crude +2.8 million barrels, Gasoline rose +5 million barrels and Hat ros 3 million barrels.  This led to the Oil meltdown from $72 to $69.  The USD got back some of what it lost yesterday and now trades at $1.4450 Euro/USD.  It looks like crude whats to push down to the $67 level again so we will see how the USD and equity markets play out in the next week.

The wheat market is up double digits due to the following factors:

Wind damage in Australia causing possible quality issues

Short covering by funds with wheat representing the biggest short on the floor

Buyers looking at 29% volatility as an oportunity as seen by funds buying 3,000 WZ 500 calls between 10.5-12 so far on the day.

I disagree with todays rally but I do admit that volatility ownership in Dec is enticing.