Good Morning!
We have reports after the warm up we will be getting back to cold Arctic weather in the Mid-west. You can be sure on both east and west coasts they believe we are going to see a winter not seen in sometime. And what weather module is followed is what investors are going to believe. Light volume, higher U.S. dollar and threats from China of an impending trade war may begin if President-elect Trump makes good on his promise to change how tariffs work and from a U.S. standpoint make it a more even playing field for trade. Although he has not officially in office he has already proven he is a businessman and a sound one with fortitude, determination, spirit, and prowess that will create jobs and growth in this long lasting slumping and stagnate economy.
In the overnight electronic session the Natural Gas is taking another beating as the mercury is supposed to rise and break through the 32 degree Fahrenheit level. But for how long? Depending on which module you believe, after Thursday the Chicago area should reach highs at or above 40 degrees and then the thermometer is forecasted deep into the Arctic zone depending again on which module investors believe. In the overnight electronic session the February Natural Gas is currently trading at 3.200, which is 8.1/2 cents lower. The trading range has been 3.275 to 3.181. This week’s EIA Gas Storage data should show extensive draws after last week’s surprise draw of 49 bcf. Thursday we are guesstimating draws of 145 bcf.
On the Crude Oil front there is no major news that rattled the market to start the week lower other than Friday’s rise in rig-counts according to the Baker Hughes report and the U.S. dollar trading higher. The February contract is currently trading at 5297, which is 102 points lower. The trading range has been 5383 to 5282.
On the Ethanol front both the February and March contracts posted trades last night with the February contract posting a trade at 1.563, which is up .012 of a cent with 1 contract traded and Open Interest at 1,563 contracts. The March contract posted a trade at 1.575 which is .012 of a cent higher as well. The market trade 2 contracts and climbing Open Interest of 1,575 contracts which looks to be the beginning of a trend of switch over in volume to the March.
On the Corn front record exports did help offset a record U.S. crop. As we wait to get through this winter and look ahead to spring plantings what will old man winter leave behind such as flooding and other Acts of God. There are also worries of the U.S. dollar launching into outer space and challenge the strength of the euro currency, which is alarming news for exporter. In the overnight electronic session the March Corn is currently trading at 358 ½, which is ½ of a cent higher. The trading range has been 359 ¾ to 358.
Have a Great Trading Day!