CBOT markets have been on the defensive throughout most of today as fund selling has dominated not only grains and oilseeds but also metals and energies. It has been interesting to note the scale down buying which has emerged from commercials (aka consumers) as they see value emerging at these lower levels.

We see this market as more technical than fundamental right now as Nov ’12 futures contracts approach first notice day in a couple of weeks. How much lower can we go? Not an easy question to answer, but we seem to be close to technical support levels on the charts.

We would expect to see seasonal lows made in the soy complex very soon and still believe that the grain fundamentals are bullish. Until the funds pick up on this news and stop selling we are destined for lower levels. Fundamentals remain unchanged, global supplies of soybeans, corn and wheat are all tighter than is truly comfortable and the current selloff is both stimulating demand, which the S&D can ill afford, and creating consumer opportunity.