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Jim Wyckoff's Morning Report: Australia Cuts Interest Rate to Record Low

07 May 2013
Jim Wyckoff Commentary -  TheCropSite

GLOBAL - In overnight news, Australia’s central bank cuts its interest rate to a record low of 2.75% in an effort to keep its economy afloat and to weaken the Australian dollar.

Yet another major central bank is working to debase its currency. Such is a bullish underlying factor for hard assets and the precious metals markets--and especially gold, which many investors view as a currency in itself.

In Asian trading the Japanese stock market hit a five-year high on the first trading day after the Golden Week holiday break.

There will be some key economic data from China released on Wednesday and Thursday. A Dow Jones Newswires report Tuesday highlighted that falling factory inventories in China are a strong signal the world’s second-largest economy is sputtering a bit. U.S. economic data due for release Tuesday includes the weekly Goldman Sachs and Johnson Redbook retail sales reports, the global services PMI, and the consumer credit report. -Jim

US Dollar Index

The U.S. dollar index is lower in early U.S. trading. Bulls still have the overall near-term technical advantage. Slow stochastics for the dollar index are neutral early today. The dollar index finds shorter-term technical resistance at the overnight high of 82.400 and then at 82.610. Shorter-term support is seen at Monday’s low of 82.040 and then at last Friday’s low of 81.835. Wyckoff's Intra Day Market Rating: 4.0

NYMEX Crude Oil

Crude oil prices are weaker early today. Bulls still have some upside momentum. In June Nymex crude, look for buy stops to reside just above resistance at last week’s high of $96.04 and then at $97.00. Look for sell stops just below technical support at the overnight low of $95.26 and then at $95.00. Wyckoff's Intra-Day Market Rating: 4.5


Markets were higher in overnight trading, on a corrective technical bounce following strong losses suffered on Monday. The U.S. Corn Belt is seeing drier and warmer weather and it appears a big chunk of the Corn Belt corn crop will get planted in the coming days. That’s bearish for corn, and corn is presently the leader in the grains complex. Soybeans and wheat will follow the corn futures market for the near term.

Traders are awaiting Friday’s monthly USDA supply and demand report. However, the weather in the central U.S. is still the major fundamental factor in the grain futures markets, at present.

TheCropSite News Desk

IMPORTANT NOTE: I am not a futures broker and do not manage any trading accounts other than my own personal account. It is my goal to point out to you potential trading opportunities. However, it is up to you to: (1) decide when and if you want to initiate any traders and (2) determine the size of any trades you may initiate. Any trades I discuss are hypothetical in nature.

Here is what the Commodity Futures Trading Commission (CFTC) has said about futures trading (and I agree 100%): 1. Trading commodity futures and options is not for everyone. IT IS A VOLATILE, COMPLEX AND RISKY BUSINESS. Before you invest any money in futures or options contracts, you should consider your financial experience, goals and financial resources, and know how much you can afford to lose above and beyond your initial payment to a broker. You should understand commodity futures and options contracts and your obligations in entering into those contracts. You should understand your exposure to risk and other aspects of trading by thoroughly reviewing the risk disclosure documents your broker is required to give you.

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