Weather Is the Focus
Today we have the weekly API Energy Stocks which could change the balance of the table. In the commodities I write in this market letter we could see the weather as a major game changer and key fundamental factors in Corn, Crude Oil, Ethanol and Natural Gas and investors will be watching the weather factors unfold. The two Tropical Disturbances in the Atlantic has had one disturbance now categorized as Tropical Storm Don.
With an active hurricane season forecasted and we are seeing activity this early with warm water temperatures in the Atlantic and crazy 2017 weather temperatures overall we may see investors wondering what sort of a bumper crop we should expect with crop ratings not as great than expected. The corn market is indicating that temperature and precipitation during this month will be critical to future downgrades expected in crop and yield reports.
The next couple of weeks should show market volatility as investors jockey their positions for the big move. In the overnight electronic session the September Corn is currently trading at 386 which is 11 cents higher. The trading range has been 388 ¾ to 378 ¾. Weather is the key in these markets from here and now.
On the ethanol front the September contract is currently trading at 1.547 which .017 cents higher. The trading range has been 1.547 to 1.545. The Estimated Volume showed 31 contracts traded and the September rollover is outpacing the August contract as the lead month. Open Interest is growing in September at 571 contracts with declines in the August contract at 731 contracts.
On the crude oil we have the weekly API Energy Stocks data released at 3:30 P.M. We had August Option Expiration yesterday which moved the market to $46 a barrel handle. This market needs to get in balance and a close above $47 a barrel will get technicians rethinking the bearish news and we could see a lights out rally well an above $50 a barrel. In the overnight electronic session the August crude oil is currently trading at 4671 which is 69 points higher. The trading range is 4675 to 4581 and looking stout with a weaker U.S. dollar.
On the natural gas front we are monitoring the movement of Tropical Storm Don which if he changes the current course could move into the Gulf of Mexico and disrupt Oil Rigs and shipping from the Houston Shipping Channel. Again weather in the lower 48’s and down below may create market volatility traders have been waiting for. And this could be a weather driven market and bring movement across the board. In the overnight electronic session the August Natural Gas is currently trading at 3.066 which is .046 cents higher. The trading range has been 3.075 to 3.020.