Last week, the USDA shocked the market with a hike in estimated corn yields and the prediction of a larger corn crop. The market sold off on Thursday, but recovered a bit on Friday. Jim Bower, with Bower Trading, sees the market starting to shift its focus to weather and demand, “The weather in South America will now take on a much more important role, especially as we get into January and February.” Bower noted that on Friday there was a very uncertain tone in the trade, “It is like nobody wanted to make a decision or take a new position.”
“The pace of buying by China will help the soy complex a lot more than most people realize,“ noted Bower. “The market is on a mission to get more soybean acres next year than corn.”
We have also seen a good deal of volatility in outside markets, primarily the stock market and oil market. That is having an impact on the commodity market, according to Bower. He stated, “We have more investor funds drifting into the commodity markets as we are seeing more investor interest in the commodities across the board.”
For more market strategy information, contact Bower Trading at 800-533-8045 or bowertrading.com.
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