CORN (March)
Yesterdays Close: March corn futures finished yesterday’s session up 3 ¾ cents, trading in a range of 5 on the day. Funds were estimated buyers of 17,000 contracts.
Fundamentals: Yesterdays move higher is mostly attributed to short covering funds as there was not much new news across the wires. Weather in South America continues to be watched closely as some weather models conflict each other. Outside of South American weather and crop development, we will continue to keep an eye on the trend of exports. The market needs to start seeing a trend of better than expected numbers to encourage additional short covering and invite new buying into the market. Due to the Martin Luther King holiday on Monday, the weekly exports data has been pushed back to tomorrow at 7:30am cst.
Technicals: The market is officially trading above the 50-day moving average for the first time in over a month. Though that is encouraging for bulls, we will be watching this on a closing basis as we have not seen a conviction close above this indicator since July. If we see a close above, the next resistance pocket comes in at 358 ¼-359 ¼. This pocket represents the 100-day moving average along with a key Fibonacci retracement level. The bears are still in control as we have made lower lows and lower highs over the past several months. If we fail to “breakout” we will likely see prices retreat towards the bottom end of the range which we have defined as 345-346 ½.
Bias: Bearish
Resistance: 358 ¼ -359 ¼***, 367-369 ¼****
Pivot: 352 ¼
Support: 345-346 ½**, 334-335 ¼***, 323-325 ¼**
SOYBEANS (March)
Yesterdays Close: March soybeans finished up 2 ½ cents yesterday, trading in a range of 8 cents on the session. Funds were estimated buyers of 2,000 contracts.
Fundamentals: With the USDA report now behind us, market participants will turn their attention back to South American weather and crop development along with weekly export data. There is not much new news to report on the weather front this morning. Due to the shortened trading week, export sales data has been pushed back to tomorrow morning at 7:30am cst. Also on trader’s radar is the soybean complex including soybean meal and soybean oil as both have shown strength recently.
Tehcnicals: March soybean futures filled the gap yesterday that was down at 962 ¾ which was followed up by buying. Bulls need to see a close above 971 ¾ soon to encourage additional short covering and new buying in the market. A close above resistance opens the door to an extension towards 984 ½-986 ½. This pocket contains several technical indicators including the 50 and 100 day moving average, along with the 50% retracement from the June lows to the July highs.
A failure to breakout will lead to pressure on prices, likely down to the bottom end of the range near 950 as technical traders exit longs because they are not getting what they want from the market. We continue to be friendly towards the market but need to see the market work higher into the weekend.
Bias: Bullish
Resistance: 971 ¾ ***, 979**, 984 ½-986 ½***, 999-1004**
Support: 950-952 ¼***, 937 ½***, 922 ¼****
WHEAT (March)
Yesterdays Close: March wheat futures finished yesterday’s session up 5 ¼ cents, trading in a range of 7 ¾ on the day. Funds were estimated buyers of 4,500 contracts.
Fundamentals: Wheat futures worked higher yesterday on the back of what was likely short covering on concerns of cold and dry weather in some key growing areas. It will likely still be a few weeks before we see the true effects of the recent weather on the crop. Export sales that are normally released this morning are pushed back to tomorrow due to the shortened trading week; they will be released at the normal time 7:30am cst.
Technicals: The bulls have been putting up a decent fight over the last month, but the bears remain in control until we see a conviction close above technical resistance. The first line in the sand comes in at 425 ¼. A close above opens the door to a potential run at the recent highs of 437. A failure to see closes above these resistance levels will likely lead to new contract lows below 410 ½.
Bias: Bearish
Resistance: 425 ¼**, 437***, 443-448 ¼ ***
Support: 410 ½**, 399-402 ¾****
For more information please contact DAW Trading at brokersedge@dawtradingdiv.com or at 877-329-0006 and visit us at https://dawtradingdiv.com/brokers-edge/
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