Posted on 03/20/2008 9:56:44 AM PDT by TigerLikesRooster
CBOT Corn Outlook:Sharply Down; Fund Liquidation To Continue
Thu, Mar 20 2008, 13:27 GMT
http://www.djnewswires.com/eu/
CBOT Corn Outlook:Sharply Down; Fund Liquidation To Continue
By Andrew Johnson Jr
Of DOW JONES NEWSWIRES
CHICAGO (Dow Jones)--Corn futures on the Chicago Board of Trade are expected start Thursday's day session on the defensive, plunging on the continuation of speculative fund long liquidation pressure.
Analysts expect corn to open 20 cents lower.
In overnight electronic trading, May corn was 19 1/4 cents lower at $5.08, July corn was 20 cents lower at $5.19 1/4, and December corn was 20 cents lower at $5.21 1/4.
Speculative fund liquidation was the dominant force directing prices overnight, with broad based selling expected to continue across the commodity asset class amid a slowing global economy, analysts said.
Outside market influences are pointing to lower price action, with technical weakness and talk of slowing demand providing pressure to weigh on prices as well, analysts added.
Crude oil futures are down more than $3.00 a barrel, with the May futures below the $100 a barrel level. Gold futures are down over $25 an ounce in early action. The U.S. dollar index is higher.
However, traders continue to look for signs of downside exhaustion, with supportive longer term fundamentals and concerns over Midwest rains delaying early fieldwork seen providing underlying support, analysts added.
Meanwhile, traders say position evening and short covering may generate some support heading into an extended holiday weekend, providing an opportunity for futures to trade off limit down levels during the session, a CBOT floor analyst said.
CBOT markets will be closed Friday in observance of the Good Friday holiday.
A technical analyst said Wednesday fresh four-week low close produced some near-term chart damage. More serious chart damage would occur on strong follow-through selling pressure and a bearish weekly low close on Thursday.
The next upside price objective for July corn is to push and close prices above solid technical resistance at $5.50. The next downside price objective is to push and close prices below solid support at $5.25. First resistance for July corn is seen at Wednesday's high of $5.47 and then at $5.50. First support is seen at $5.35 and then at $5.30.
U.S. Department of Agriculture reported total weekly corn export sales were 780,700 metric tons for the week ended March 13. 2007-08 marketing year sales totaled 749,500 tons. The sales were primarily for Japan with 399,700 metric tons, and Mexico with 107,400 tons. Analysts had forecast sales between 550,000 and 800,000 metric tons.
In other news, South Korea on Thursday announced an emergency decision to lift import tariffs on 70 price-sensitive products including wheat and corn to help tame rising inflation. The decision was made at a meeting of economic ministers chaired by President Lee Myung-Bak, the presidential office said.
-By Andrew Johnson Jr., Dow Jones Newswires, (312) 347-4604 andrew.johnsonjr@dowjones.com
(END) Dow Jones Newswires
March 20, 2008 09:27 ET (13:27 GMT)
Ping!
Good. I, and others, have been predicting this for weeks.
Corn, oil, gold...all bubbles.
Now, we need to stop burning food in our cars until we can do it without driving up food prices.
Have you seen this one?
“The Great Unwind Has Begun”
Might be worth posting, I’m rushing today.
If enough have already done so, it just might bust some of the traders/investors that have played havoc on the market.
Yeah I read that - it’s a very plausible article.
If the price of corn and soybeans continue to slide,farmers will cut back on planting.My production costs have soared -at some point I’m gonna have to sit one out.
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