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Where do the markets go from here?

Agriculture.com Staff Updated: 12/15/2010 @ 9:21pm

Where are these markets going? Though most fundamentals are looking up, some say there are "cracks in the bull market" and the trade could be starting to turn lower. Whether that's true or not depends a lot on some factors that are sending mixed signals to the trade, like a potential "delayed frost rally" and USDA grain stocks numbers that some analysts are starting to question. And, don't look now, but crude oil could be poised for $90 per barrel soon.

All these factors are unfolding against the backdrop of a battle for acres already catching traders' eyes in Chicago. Wheat and corn are getting a lot of attention right now, but don't count out soybeans.

Roy Smith: Delayed frost rally?

The psychology of the corn market in 2010 is similar to the soybean market in an average year, except that it is delayed by three weeks. If the same psychology carries out in the corn market as it usually does in soybeans, it will take about three more weeks for prices to adjust to the additional bushels.

Ray Grabanski: Crunch time?

Are we turning the bull market into a bear market? Or is this just a short term correction in what is a bullish market??? This reminds me of a saying one of my mentors used to quote, "The markets job is to keep everyone confused". Well, so far, the market is doing its job.

The carryout is the carryout

The USDA released an ending stocks number for corn Thursday that was shockingly large -- 1.708 billion bushels. It will stare us in the face every time we look at historical supply/demand data. There are two problems that need to be considered with this number.

Can the grains stay strong?

If the third quarter was a dream, commodity fund managers may not want to wake up. Looking ahead, commodities are in for "interesting test" during the final quarter, said Kevin Norrish, managing director of commodities research at Barclays Capital.

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