Market was trading much lower electronically this morning as much as 90 pts down on the N'07 and Z'07. This was blamed mostly on favorable weather that arrived for grains and cotton this week which had much more of a negative effect on soybeans and corn which were both down over 20 cents.
The market worked its way back up, but the N'07 struggled all day breaking under 54.00 c/lb. and allowing the spread to widen back out to a high of 500 pts from a low near 430 pts at one point in the day. Open interest in N'07 came down yesterday over 7,000 contracts to reach under 20K and total open interest was 207K.
Electronic trading exceeded open out cry with 17,000 contracts compared to 10,000. Options were neutral to bearish today with a combined volume near 8,000. Most of the activity was related to the roll as we have 3 trading days left before FND. Certificated stocks are growing so there does not seem to be a strong stopper and this may allow the spread to get back out to the levels where it traded between 550-600 pts.
over 2 weeks ago. The spec hedge report will be released tomorrow after being delayed because of option expiration. This will be very important to determine how much ammunition the specs have left as we have started to reach overbought conditions with the RSI and demand has slowed considerably along with favorable weather in the Delta and West Texas.
The next big report that could influence NY will be the USDA acreage report on June 29th if it comes in much lower than the estimate made at the end of March of 12.147 ma's.
marketing@alchempro.com
