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Yesterday’s Close: December corn futures finished yesterday’s session down 1 ½ cents, trading in a range of 2 ½ cents. Funds were estimated sellers of 1,500 contracts on the day.
Fundamentals: The election has come and gone, and the markets reactions were similar to that of trying to light a 5-year-old firework you just found. Attention will no be solely focused on tomorrow’s USDA report. Early estimates are for yields to come in at 180 bushels per acre, putting total production at 14.721 billion bushels. Carryout estimates are near 1.773 billion bushels. We do have a bearish seasonal trade that starts tomorrow. If you had sold December corn on November 8th and bought back on November 19th, you would have been profitable for 13 of the last 15 years, the average profit on that has been 11 cents.
Technicals: Yesterday’s tight ranging trade does little to change the near-term technical landscape. The chart is continuing to look constructive, but the bulls need to chew through resistance to really get the party started. We have outlined that as 375 ¾-378 ½, this pocket represents a key Fibonacci retracement and the October highs. A conviction close above here opens the door for an extension towards 386. On the support side of things, the bulls want to defend 367 ¾-370 through the week. A failure to do so will neutralize our bullish bias.
Resistance: 375 ¾-378 ½****, 386-387 ¾***
Support: 367 ¾-370**, 360 ¼-363 ½***, 354 ½-356 ½****
Yesterday’s Close: January soybeans finished yesterday’s session down 1 cent, trading in a range of 10 ¾ cents. Funds were estimated sellers of 1,500 contracts on the day.
Fundamentals: With the election behind us, attention will be focused on tomorrow’s USDA report, scheduled to be released at 11 am cst. Early expectations are for yields to come in near 52.9 bushels per acre, putting production near 4.676 billion bushels. Carryout estimates are coming in near 898 million bushels.
Technicals: Yesterday’s price action stayed contained, trading between key technical support and resistance for the second consecutive session. On the support side of things, our pocket from 878-880 was tested and held. This pocket represents the 100-day moving average and the 50% retracement from the July 31st highs to the September 18th lows. A breakdown below here opens the door for another 15 cents lower. ON the resistance side, 892 represents a key retracement but the more significant pocket comes in from 900 ¾-906 ¼. A move above here would likely spark another surge of short covering.
Resistance: 892**, 900 ¾-906 ¼****, 932-935 ¼***
Support: 878-880***, 864 ½-865 ¾****, 839 ¼-844 ½**
Yesterday’s Close: December wheat futures finished yesterday’s session up 4 ¾ cents, trading in a range of 8 ½ cents. Funds were estimated buyers of 3,000 contracts on the day.
Fundamentals: A bearish seasonal trade starts tomorrow for Chicago, March wheat. If you had sold on November 8th and bought back on December 11th, you would have been profitable for 13 of the last 15 years, the average gain has been about 13 cents. We continue to watch the US dollar very closely as it will have a direct impact on the export market. If the dollar continues to soften up, we would expect to see that put a soft floor in the market. Estimates for ending stocks in tomorrow’s USDA report are coming in near 958 million bushels.
Technicals: Futures are trading near the top end of technical resistance, a pocket that we have defined as 515-519 ½. A breakout above here could spur a round of short covering from the funds. On the support side of things, 5.00 is both technically and psychologically significant. A breakdown below here could take us closer to contract lows from December. From the risk/reward side of things, we like looking for long exposure here.
Resistance: 515-519 ½***, 528-531 ¼***
Support: 500***, 485 ½***, 468 ¼-473 ¾****
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