Grain and livestock markets close mostly higher on Thursday.
Garrett Toay, AgTraderTalk, says corn made six month highs and tThe March corn contract finally closed above the 200-day moving average, which has been tough chart resistance.
“I mean it’s the highest close since June which is the highest level we’ve had the majority of the growing season,” he explains.
The key will be if the market can continue to build on it, especially with strong corn demand.
This kind of strong technical action can often attract fund buying and Toay says it looks like they want to be long corn right now but the jury is out on how much they want to add to their long position.
While March and May corn are making new highs for the move, the Dec 25 corn is not, according to Toay, due to the anticipation of higher acreage.
“So, that’s a bit concerning there especially as the focus is shifting to new crop,” he adds.
Soybeans also saw strong gains on fund short covering and technical buying but Toay says the market is back up into resistance on the charts at the point of the previous breakout.
“We kept soybeans from falling into the abyss and now there are some trapped shorts in this market,” he says.
However, the soy market is still pricing in the talk of possible China export business and holding a slight premium until the South American crop finishes.
Wheat followed the strength in row crops as there is very little news to move the market.
Cattle futures ended higher despite cash news and Toay chalks it up to a relief rally.
“Last week live cattle held the 200-day moving average and saw technical buying. This week looks like a relief rally after cattle followed the break in the equity markets and have recovered,” he says.
Lean hog futures opened lower but rebounded to close mostly higher but he says that market is in a consolidation phase.
