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Yesterday’s Close: Corn futures finished the session up ½ cent, trading in a range of 3 cents for the day. Funds were estimated buyers of 11,500 contracts.
Fundamentals: There was not much new news on the wire yesterday as market participants gear up for tomorrows WASDE report which is due out at 11 am cst. The global corn carryout is expected to come in between 2.222-2.352 billion bushels with the average estimate coming in at 2.313 billion bushels. Brazil corn production is expected to be pegged at 91.6mmt with the range coming in from 86.2-95.5mmt. Argentina production estimates range from 33-38.5mmt with the average estimate coming in at 36.5.
Technicals: The market continues to grind higher, trading in the green for 6 of the last sessions. The relative strength index is at 78.15 this morning which is “overbought” but the market seems to be shrugging it off as the funds continue to add length. First technical resistance remains in a pocket from 391 ¾-392 ¾, this pocket represents the 50% retracement (middle of the range) from the July highs to the January lows. The bulls will remain in control until a close back below technical support which we have outlined as 379-382 ¾. This pocket represents a key Fibonacci retracement level, the 200-day moving average, along with previously important price points.
Resistance: 391 ¾-392 ¾**, 400 ¾-406***
Support: 379-382 ¾****, 376-376 ½**, 370 ¼-372 ¼***
Yesterday’s Close: Soybean futures finished the session down 2 cents, trading in a range of 7 ½ cents for the day. Funds were estimated sellers of 3,500 contracts.
Fundamentals: Market participants are looking forward to getting some new news on the wires that doesn’t surround weather, that will come in the form of a USDA report. Soybean carryout estimates are ranging from .490-.590 billion bushels with the average estimate coming in at .529 billion bushels. Brazil soybean production estimates are ranging from 112.0-116.0mmt with the average estimate coming in at 113.ommt; this compares to last month’s 112.0mmt. Estimates for Argentina’s production range from 45-53.5mmt with the average estimate coming in at 48.5; this compares to last months 54mmt.
Technicals: The big move higher of the last month has sparked some FOMO (fear of missing out) in the bear camp which has proved to be costly over the last month, we continue to be patient in waiting for a short opportunity. The market has been in a bit of consolidation mode over the past three sessions as the bulls and bears sit on their hands waiting for another breakout or a breakdown. The RSI (relative strength index) is still in “overbought” conditions with a reading of 74.10 despite a choppy sideways trade recently. The fact that the bears were not able to see follow through selling on Fridays rejection at resistance is a caution flag for bears and a silver lining for bulls. If the markets retest resistance from 1080-1082 ½ we would expect to see a continuation towards 1091 ½. On the support side of things, there is not a lot until 1059-1065; bulls remain in control until a close below.
Resistance: 1080-1082 ½****, 1091 ½**, 1119 ½-1123****
Support: 1059-1065***, 1039-1040****, 1013 ¾-1016**, 1001-1006***
Yesterday’s Close: Wheat futures finished the session down 1 cent, trading in a range of 12 ½ for the day. Funds were estimated sellers of 3,000 contracts.
Fundamentals: The market has held ground relatively well over the past week as concerns over the winter wheat crop continue to loom. Dry weather has been the underlying support factor over the last month, if rains make their way into the areas that need it we could see some premium work its way out of the price. Tomorrows USDA report is due out at 11am cst. The wheat carryout is expected to come in near 1.007 billion bushels with the range of estimates coming in from .970-1.035 billion bushels; last month’s came in at 1.009.
Technicals: The market has seen a whipsaw like trade over the past few sessions, spiking lower but recovering the losses by the close. This has sucked in some anxious shorts and shaken out a lot of the weak longs and is encouraging for the bull camp in our mind. The market has been able to hold support which we have outlined as 493 ¼-499 ½ and has formed a bit of a bull flag, something we had been writing about expecting to see over the past week. The bulls need to chew through 516-518 ½ resistance on a closing basis to encourage another big round of short covering from the funds. The next resistance pocket doesn’t come in until 535-538 ¾.
Resistance: 516 ¾-518 ½***, 535-538 ¾**, 550***
Support: 493 ¼-499 ½**, 478-481 ½***, 451-453****
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