Price action: Corn futures closed 4 to 6 cents higher, which was in the upper end of today's range but off session highs.
Fundamental analysis: Corn futures were supported by corrective buying. Much of the incentive to cover short positions came from the wheat market, which posted double-digit gains. With harvest progressing across the Corn Belt and early yields coming in relatively strong compared to expectations, it's going to be difficult to attract sustained buying interest.
Funds were net buyers of corn today, purchasing an estimated 6,000 contracts (30 million bushels). Funds are heavily short the market, suggesting there could be an extended move higher on corrective buying. But there will need to be a strong bullish catalyst to get funds to actively cover short positions in the face of harvest.
Technical analysis: Key support for December corn futures lies at the August low of $4.45 3/4. A drop through that level would likely trigger sell stops and drive the contract the next leg lower on the daily chart. Any move to the upside would be a correction to the bear market unless the August spike high at $5.08 1/4 is cleared, as that level also represents a 50% retracement of the price plunge from the June high to the August low.
Hedgers: 25% of expected 2013-crop production is sold via cash forward contract for harvest delivery.
Cash-only marketers: 25% of expected 2013-crop production is sold via forward contract for harvest delivery.
Advice: Hedgers were advised to sell 50% of expected 2013-crop production for harvest delivery to get to 100% sold in the cash market. Cash-only marketers were advised to sell 25% of 2013 production to get to 75% priced.
Price action: Soybean futures saw pressure early this morning, but this gave way to bargain buying that helped the market to finish 3 to 9 1/4 cents higher through the August 2014 contract, with nearbys leading to the upside.
Fundamental analysis: Soybeans saw a return of buying interest today as the market recognizes that demand remains strong, USDA is expected to confirm tight soybean stocks on Monday and early harvest results may be some of the best as these will be for the earliest planted beans. Tomorrow morning's Weekly Export Sales Report will provide traders a read on whether prices have dipped low enough to spur even stronger export buying. Gulf basis strength today indicates this may be the case.
But harvest is getting started in the Midwest, which will make it tough for beans to find buying interest outside of corrective short-covering until roughly half the crop has been combined.
Technical analysis: November soybeans posted an upside day of trade, but the contract remains little changed on the week. Key is whether recent consolidation action is a pause in the downtrend that will set up a test of the July high at $12.97 or a basing pattern, setting up a move back above the Aug. 26 gap area above $13.48.
Hedgers: NEW ADVICE: Make a 50% cash sale for harvest delivery on expected 2013-crop production to get to 100% sold in the cash market.
Cash-only marketers: NEW ADVICE: Make a 25% sale for harvest delivery on expected 2013-crop production to get to 75% sold.
Price action: Wheat futures opened firmer and moved higher through the day before experiencing light profit-taking at the close. Futures settled near their highs with SRW up 8 1/2 to 12 1/4 cents, HRW up 9 1/4 to 13 1/4 cents and HRS up 9 3/4 to 13 1/4 cents.
Fundamental analysis: Wheat futures opened higher and firmed through much of the day on continuing concerns over potential freeze damage to the Argentine wheat crop. Futures prices surged Tuesday on reports of frost striking that country's crop and the continuation of cold temperatures through the week over the region moved prices higher again today.
In addition, futures gained support from thoughts U.S. wheat prices have become competitively priced on the global market. Recent sales offer evidence of this view and today's slippage in the U.S. dollar is viewed as making U.S. wheat prices even more competitive.
Technical analysis: December SRW wheat futures finished above the $6.70 level to signal a rounded bottom is forming. That contract has further resistance at the August high of $6.76 1/2. Closing above that resistance would confirm a double saucer bottom and project a move to the $7.17 area, which coincides with a small gap at $7.13 1/2. However, resistance lies at $6.80 and $7.05 3/4 on the way to reaching that possible chart objective. The December SRW contract now has support at $6.60.
Hedgers: 50% of 2013-crop is sold in the cash market.
Cash-only marketers: 25% of 2013-crop is sold.
Price action: Cotton futures saw two-sided trade today, but futures edged out slight daily gains of 11 to 30 points on a midrange close.
Fundamental analysis: Cotton futures saw light followthrough buying today amid continued concern about this year's U.S. cotton crop that is lagging in terms of development. In addition, heavy rains in the Southeast and the forecast for several inches of rain in Texas later this week raise quality concerns as the crop is in the midst of opening bolls.
Spillover from the grain and soy markets added light support, as did weakness in the U.S. dollar index.
Technical analysis: December cotton futures remain in their uptrend since early September, but gains have moderated a bit this week. Bulls' initial target is last week's high of 85.78 cents, followed by the May high of 87.25 cents.
Hedgers: 50% of expected 2013-crop production is hedged in December cotton futures at 83.87 cents. 50% of expected 2013-crop production is also sold via cash forward contract for harvest delivery.
Cash-only marketers: 50% of expected 2013-crop production is sold via cash forward contract for harvest delivery.