Market moving headlines were again predictable over the extended US holiday weekend meaning we can again see the manipulation from a mile away.
Watson was triggered into selling global energy markets and buying equities before the realization nothing had changed set in through early Tuesday morning.
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Grains were under pressure, but rallying off initial overnight lows pre-dawn.
Morning Summary: As the US comes out of its latest 3-day holiday weekend, any one of us with two brain cells rubbing together could’ve written Tuesday morning’s headlines. Particularly after we were told a “deal” to reopen the Strait of Hormuz – a key passage for global crude oil only closed because of the US president’s War on Iran – was “largely negotiated” and would be announced “soon”. We all knew it was a lie, and sure enough, Tuesday’s headlines read: U.S. conducts ‘self-defense strikes’ in Iran as the (US president) pushes for peace ‘deal’; Brent crude rises 3% as Iran vows retaliation against ceasefire (this word still makes me laugh) violations after U.S. strikes; Russia warns U.S. citizens should leave Kyiv ahead of strikes (this sounds familiar, right?); European stocks edge lower amid U.S.-Iran peace talks uncertainty; and finally, Dow futures jump over 300 points as oil tumbles on hope (a four-letter word in markets) U.S.-Iran deal is close. Look, it is simple, this is all by design, with the key being the last one: US stock indexes are supposed to go up because, as we are told, that IS the US economy. End of story. Once again, it is predictable chaos.
Corn: The corn market was in the red pre-dawn Tuesday on heavier trade volume. July initially fell as much as 6.25 cents on spillover pressure from the Energies sector. A side note: WTI (CLN26) dropped as much as $7.19 (7.4%) while Brent (QAN26) fell as much as $7.61 (7.3%) with both cutting losses roughly in half as of this writing. For the record, King Gold (GCM26) rallied as much as $60 (1.3%) before falling back in the red as Monday’s news continued to develop. July corn (ZCN26) was sitting 1.75 cents lower to start the day and showing traded volume of 65,500 contracts. As we head into the last trading day of this holiday-shortened noncommercial positioning week, July is down roughly 14.0 cents from last Tuesday’s settlement of $4.7525. Last Friday’s Commitments of Traders report showed funds held a net-long futures position of 358,100 contracts, a decrease of 25,435 contracts from the previous week, in line with July closing 4.75 cents lower from Tuesday-to-Tuesday. As for new-crop, September (ZCU26) was down 0.75 cent, and December (ZCZ26) was 0.25 cent lower at this writing after falling as much as 6.5 cents each overnight. If I pretend weather still matters, the US Midwest saw good rains over the extended holiday weekend.
Soybeans: The oilseed sub-sector was – well, I’ll let you guess on the direction of most markets. As a hint I’ll tell you diesel fuel (HON26) was down 8.6 cents (2.2%) after dropping as much as 20.5 cents (5.4%) Sunday night through early Tuesday morning. Okay, have you made your choice on oilseeds between Up, Down, or Sideways? If you hit the Red button for down, well done. July soybean oil (ZLN26) fell as much as 0.99 cent (that one tick might’ve been important to Watson) but had trimmed its loss to only 0.07 cent as of this writing on what looked to be renewed commercial buying. This make sense given the situation with the US president’s War on Iran is Still the Same, as Bob Seger would say. July soybeans (ZSN26) lost as much as 11.5 cents overnight but were down only 5.0 cents for the day and 18.0 cents for the positioning week pre-dawn Tuesday. The latest Commitments of Traders report showed a noncommercial net-long futures position of 212,240 contracts, a decrease of 11,760 contracts from the previous week when July closed 17.25 cents in the red. New-crop November (ZSX26) was sitting 3.75 cents lower after sliding as much as 9.0 cents overnight. New-crop futures spreads were neutral-to-bullish as last week ended.
Wheat: The wheat sub-sector was in the red across the board pre-dawn Wednesday. After driving through the heart of the US Wheat Belt this past weekend, I can tell you this: I don’t want to be short wheat because of the short wheat. Makes sense, right? The deeper we drove into the Southern Plains the shorter the Fields of Gold (thank you Sting) were, a strange sight given harvest is moving up from the farthest south fields of Texas. But then again, I’m not bullish wheat because harvest is indeed drawing near and the world is not going to run out of Poverty Grass any time soon. Which makes Putin’s threats against Kyiv that much more interesting. July HRW (KEN26) was down 0.75 cent at this writing after slipping as much as 9.75 cents overnight. This puts July down 22.25 cents for the positioning week indicating Watson might’ve switched to a net-short futures position, with last Friday’s Commitments of Traders report showing a net-long of 5,420 contracts, a decrease of 8,810 contracts from the previous Tuesday. What makes this more fun is the new generation of predictive market website gambler just moved SRW to a net-long futures position of 263 contracts despite futures spreads in this market deep in bearish territory.
On the date of publication, Darin Newsom did not have (either directly or indirectly) positions in any of the securities mentioned in this article. All information and data in this article is solely for informational purposes. For more information please view the Barchart Disclosure Policy here.
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