Price action: December corn futures rallied 11 1/2 cents to $4.97 1/2, the highest close in nearly two months.
Fundamental analysis: Corn futures powered higher throughout the session after a break of technical resistance that capped gains the prior five sessions. This rally came despite continued volatility in outside markets, including volatility in the U.S. stock market, selling pressure in the crude oil market and rising long term treasury yields. This morning’s USDA export data showed net sales at 1.816 MMT, which was in the upper end of expectations that ranged from 1.4 and 2.0 MMT. While outstanding sales remain historically low, the recent uptick in sales has given bulls confidence that prices are in value territory. Also fueling the intraday rally was reports of a cargo ship reportedly contacting a sea mine this morning while waiting outside the entrance to the Sulina Canal while in route to Ukrainian ports.
Weather remains favorable for crop maturation and harvesting as conditions remain dry, though some rain occurred in some southern, central and northwestern portions of the Midwest, World Weather Inc says. The Ohio, Illinois, Mississippi and lower Missouri rivers remain below flood stage and are likely to decline over the next week, further restricting barge traffic and barge rates. Rain during the middle to late part of next week should, at least temporarily, raise water levels along most of the rivers, the forecaster says.
Technical analysis: December corn futures saw sustained buying throughout Thursday’s session, indicating a technical bullish breakout on the daily bar chart. Prices closed above 40-day resistance, now support, for the first time since late July. Initial support lies just under today’s close at $4.96. Firmer support stands at the 40-day moving average, currently at $4.89, which is backed by $4.84 1/2. Bulls are targeting initial resistance at the psychological $5.00 level, which is backed by $5.06 1/4.
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