A choppy trade to start the shortened week. Are the markets discounting the extreme heat and lack of moisture as corn and soybean crops limp towards full maturity?
Corn
News
- Crop Progress will be released after the close. Analysts are expecting to see a 2-3% decline in good/excellent conditions.
- Export Inspections out at 10am CT.
- Expect updated crop production estimates from a number of firms on Wednesday and Thursday, ahead of next week’s USDA report.
- The second half of August was exceptionally dry in the U.S. Corn Belt, likely trimming yields for corn and especially soybeans due to their reliance on late-season moisture. -Reuters
| Technicals (December) December corn futures continue to linger near the lower end of the trading range as the market attempts to carve out a low. The Bulls need to see consecutive closes back above 489-491 to feel better about a near term low being put in. Until then, the Bears have the technical advantage. Support remains intact from 472-476. As stated for the last week(ish): we wouldn’t be surprised to see a choppy sideways trade in the near term. Not a great environment for perma-bulls or perma-bears, but great for shorter term trading opportunities on both sides of the market. Bias: Neutral Resistance: 497 1/2**, 502-506 1/2***, 518-525 3/4**** Pivot: 489-491 Support: 472-476****, 460-464 1/2** |
Seasonal Tendencies
| Below is a look at seasonal averages for December corn. The 5-year seasonal average suggests seasonal consolidation while longer term averages continue to trend lower into harvest. |
| Soybeans |
- Crop Progress will be released after the close. Analysts are expecting to see a 2-3% decline in good/excellent conditions.
- Export Inspections out at 10am CT.
- Expect updated crop production estimates from a number of firms on Wednesday and Thursday, ahead of next week’s USDA report.
- The second half of August was exceptionally dry in the U.S. Corn Belt, likely trimming yields for corn and especially soybeans due to their reliance on late-season moisture. -Reuters
| Technicals (November) November soybean futures are drifting lower this morning, inching closer to trendline support and the 50-day moving average which come in near 1350-1355. We talked about this pocket in Friday’s report being the next downside objective for the Bears. The 200-day moving average comes in just below there. We would see these levels as potential buying opportunities on the first test, whether that be covering shorts or initiating longs. Bias: Bullish/Neutral Resistance: 1390 1/2-1392**, 1409 1/2**, 1428-1435**** Pivot: 1373-1381 Support: 1350-1355***, 1331** |
| Seasonal Tendencies Below is a look at seasonal averages for November soybeans. Seasonal tendencies have shown consolidation into the middle of September, but that turns to weakness in the back half of the month. |
Wheat
News
- Russian President Vladimir Putin said Monday that a landmark deal allowing Ukraine to export grain safely through the Black Sea amid the war won’t be restored until the West meets Moscow’s demands on its own agricultural exports. -AP News
- A Russian drone strike on a Ukrainian grain exporting port damaged warehouses and set buildings on fire on Monday, Kyiv said, hours before scheduled talks between Russian President Vladimir Putin and Turkish leader Tayyip Erdogan.The attack on the Danube River port of Izmail in Ukraine’s southern Odesa region hit warehouses and production buildings, and debris from drones that were shot down set ablaze several civilian infrastructure buildings, the regional governor said. -Reuters
- Export Inspections out at 10am CT.
| Technicals (December) December wheat futures took out last week’s low by a tick in the overnight trade but weren’t able to trigger a wave of stops. The market has since recovered and is trading back in positive territory and right near the psychologically important $6.00 level. We like the risk/reward to the upside here as we approach a potential seasonal low. Bias: Neutral/Bullish Resistance: 643 1/2-646 1/4****, 677 1/4-682 1/4*** Pivot: 608 1/4-612 Support: 595-599 1/2** |
| Seasonal Tendencies Below is a look at seasonal averages for December Chicago wheat. We are inching closer to a seasonal low (based on historical tendencies). Will that play out again this year? TBD. |
