Grain Markets are Under Pressure to Start the Week
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Corn
Technicals (May)
Last week's rally in corn marked the largest two-week rally since July. Much of the move occurred in the final two days as the breakout above the 20-day moving average (purple line in chart below) likely spurred technical short covering which took prices to resistance from 440-441. If the bulls can chew through and close out above that pocket, it could trigger another wave of short covering. On the flipside, previous resistance will now act as support, we see that coming in from 429 1/2-433 1/4.
Bias: Bullish/Neutral
Resistance: 440-441, 447 1/2-450*
Pivot: 429 1/2-433 1/4
Support: 421-422, 415-416, 398-402**
Fundamental Notes
With Brazil's second corn crop estimated to be nearly 100% planted, weather will be monitored even more closely.
As we inch closer to Spring, weather in the US will start becoming an important factor too. Things can change on a dime, but early concerns from the drought monitor look to be focused on Iowa.
Seasonal Tendencies & Fund Positioning
Seasonal Tendencies & Fund Positioning Update: Corn – Blue Line Ag Hedge
Soybeans
Technicals (May)
Soybeans broke out above the 20-day moving average on Friday which spurred a wave of short covering, taking prices back to their highest closing price in a month, 1184, which just happened to be first our first resistance level in Friday's report. So far, there has been a lack of follow-through in the Sunday night and Monday morning trade, but the day is young. If the Bulls can find their footing on the floor open, we could see the rally extend towards 1198-1205 1/2. On the flipside, previous resistance will now act as support, that comes in from 1163-1168.
Bias: Neutral/Bullish
Resistance: 1184, 1198-1205 1/2*
Pivot: 1163-1168
Support: 1125-1130**
Fundamental Notes
Harvest in Brazil is estimated to be nearly 60% complete.
Seasonal Tendencies & Fund Positioning
We took a deeper dive into seasonal tendencies and Fund positioning for soybeans in a weekend article we titled: The Big Short – Blue Line Ag Hedge
Wheat
Technicals (May)
May wheat futures were able to find their footing on Friday despite seeing a second consecutive day of export cancellations which in hindsight was a classic "trade the rumor, fade the news" type of event. The Bulls have their work cut out for them in this week's trade with a massive technical hurdle coming in from 546 1/4-551 1/2. Consecutive closes above that pocket may be able to spark a relief rally, until then, the Bears are in the driver's seat.
Bias: Neutral
Resistance: 573-578, 595 3/4-600, 608 1/2-611**
Pivot: 550-555
Support: 525**
Fundamental Notes
- Two export cancellations last week:
- March 8th:
- Private exporters reported the cancellations of sales of 110,000 metric tons of soft red winter wheat for delivery to China during the 2023/2024 marketing year.
- March 7th:
- Private exporters reported cancellations of sales of 130,000 metric tons of soft red winter wheat for delivery to China during the 2023/2024 marketing year.
Seasonal Tendencies and Fund Positioning
We took a closer look at shorter and longer term seasonal trends for Chicago wheat futures as well as examined the Fund positioning of Funds. Check it out by clicking the link below:
A Closer Look at the Wheat Market – Blue Line Ag Hedge
