Bobby Coats and Bert Greenwalt attend Ag council of Arkansas meeting
Bobby Coats and Bert Greenwalt, agricultural economists with the University of Arkansas and Arkansas State University, catch up at the Agricultural Council of Arkansas annual meeting in Little Rock.

Rice maintains price firmness; soybeans, corn consolidating

Corn and soybeans showing signs of improvement if market forces cooperate.

What to expect from the markets this week, July 31, 2017

Note: Click download button at the bottom of this file to see this week’s commodity analysis charts.

Market “Near Term” Snap Shot

  • Rice: Bullish bias remains, but corrective price action desirable
  • Cotton: Bottoming process underway
  • Soybeans: Likely consolidating before moving higher
  • Corn: As long as corn remains above 3.69 given global economic dynamics this market near term is more bullish than bearish
  • Wheat: Global macro dynamics a key consideration in not being overly bearish wheat, soybeans, corn and rice
  • 10-year Treasury Yield: Range bound, but bullish bias or lower yield remains
  • S. Dollar: Near term some correction of downside move should be anticipated before moving lower
  • Oil $WTIC: An interesting week ahead for oil. Geopolitical considerations and building possibilities of a Venezuelan civil war moved oil prices back above 48-dollars
  • Commodity Index: Will global reflation efforts be enough to keep this index from revisiting previous lows? Do not rule out a revisit to previous lows, but this index is building a base to move higher
  • S&P 500: Prices still moving higher, but a cautionary time period
  • Global Equities: A cautionary time period, trend remains up
  • Feeder and Live Cattle: Consolidating before moving higher   

In addition to the following “Expanded near Term Market Outlook Considerations for Week Beginning July 31, 2017”

  • Download Slide Show for charts and expanded details, Click Download button.

This Week’s Select Summary Considerations:

  • 10-Year US Treasury Yield:
    • Range bound, but bullish bias or lower yield remains
    • We enter the week with the 10 Year US Treasury Yield slightly bullish with a potentially lower yield
    • The larger trend remaining bullish or lower yield
    • Most likely Demand, Economic Weakness, Event Risk Concerns, or Other Market Concerns/Factors will take yields lower to 2 or below before significant move higher
  • US Dollar Index:
    • In search of a bottom with a near term potential of 92 and then increasingly likely lower to 87 or lower
    • Near term some correction of downside move should be anticipated
    • Bigger picture assuming no significant global anomaly event this index may have some serious weakness
  • CRB Index:
    • Will global reflation efforts be enough to keep this index from revisiting previous lows? Do not rule out a revisit to previous lows, but this index is building a base to move higher
    • Bigger Picture: Though spastic, global macro and growth forces in general remain supportive of the commodity sector
    • Between Fed off-again and on-again accommodation and/or misdirectional verbal guidance, building uncertainties surrounding fiscal, trade and regulatory policy simulative activities, the $CRB Commodity Index: a key economic indicator, has struggled
  • $WTIC Light Crude Oil:
    • An interesting week ahead for oil. Geopolitical considerations and building possibilities of a Venezuelan civil war moved oil prices back above 48-dollars
    • A complex, volatile and an uncertain market that deserves a great deal of respect in a world with building economic, social, political and homeland security uncertainties
  • Soybeans:
    • Likely consolidating before moving higher
    • Global macro forces possibly price supportive, a price move through $10.21 and holding opens the door to higher prices
  • Corn:
    • As long as corn remains above 3.69 given global economic dynamics this market near term is more bullish than bearish
    • Cautionary Note: Oil prices have rebounded, but sustained oil price weakness could possibly be problematic for corn prices
  • Long Grain Rice:
    • Bullish bias remains, but corrective price action desirable
    • This is a highly complex market with an array of factors impacting price from 2017/2018 beginning stocks; 2017 acreage, production and quality uncertainties; present underlying aggregate commodity sector dynamics; problematic global economic momentum, geopolitical uncertainties, and/or global agronomic outlook
  • Cotton:
    • Bottoming process underway
  • Wheat:
    • Global macro dynamics a key consideration in not being overly bearish wheat, soybeans, corn and rice
  • SPY SPDR S&P 500 ETF:
    • Prices still moving higher, but a cautionary time period
    • Allow price action to provide guidance
  • QQQ NASDAQ Power Shares:
    • Technology continues to perform, remain cautious
    • Allow price action to provide guidance
  • EFA iShares ETF - Global Equities Excluding U.S. and Canada:
    • A cautionary time period
    • Trend remains up
    • Allow price action to provide guidance
  • EEM iShares ETF, Emerging Market Equities:
    • A cautionary time period
    • Trend remains up
    • Allow price action to provide guidance
  1. Bobby Coats is a professor in the Department of Agricultural Economics and Agribusiness, Division of Agriculture, University of Arkansas System. E-mail: [email protected]

 

DISCLAIMER-FOR-EDUCATIONAL-PURPOSES

Hide comments

Comments

  • Allowed HTML tags: <em> <strong> <blockquote> <br> <p>

Plain text

  • No HTML tags allowed.
  • Web page addresses and e-mail addresses turn into links automatically.
  • Lines and paragraphs break automatically.
Publish