Corn, soybeans, and wheat futures are all higher in the early morning trade following yesterday’s crop progress report. Will the rally continue or will sellers pounce?
Corn
News
- Good/Excellent conditions dropped 3% from last week to 53%, just 1% below last year at this time. 67% of the crop is dented and 18% of the crop is mature.
- It’s notable that Iowa is at 49% good/excellent and Illinoi is at 57%, both sharply lower versus last year at this time.
- Weekly export inspections were reported at 481,309, about 120k less than the previous week.
Technicals (December)
December corn futures are attempting to carve out a low, positing two consecutive days of gains and currently working on their third. The relief has taken prices back into our pivot pocket from 489-491. The Bulls need to see a close above this pocket to encourage additional short covering and a potential retest of the psychologically significant $5.00 level. As mentioned for the last week+, we continue to believe that this is an environment that provides short term opportunities for traders 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
News
- Good/Excellent conditions were reported at 53%, that was a 5% drop from the previous week. Analysts were looking for a decline of just 3%.
- Good/Excellent conditions for Iowa are at 49%, that’s 17% behind last year. Illinois stands at 58%, 9% below last year at this time.
- Weekly export inspections were reported at 378,595 metric tons, about 50,000 metric tons less than last week.
Technicals (November)
November soybeans gapped higher last night following a worse than expected crop progress report. With that said, it has been a relatively tame reaction thus far. A failure to sustain the overnight momentum would not be good for the Bulls. Trendline support and the 50-day moving average would be the downside target, that comes in near 1350-1355.
Bias: 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
- Spring wheat harvest was reported at 74% complete, 3% ahead of expectations.
- Winter wheat is 1% planted, 2% below expectations.
- Weekly export inspections were reported at 299,862 metric tons, about 90k metric tons less than last week.
Technicals (December)
Wheat futures are continuing to prove for a seasonal low. The Bulls need to see a close out above 608 1/4-612 to open the door to a bigger short covering rally. We continue to like the risk/reward setup here with some various options strategies. Feel free to reach out to the trade desk to discuss.
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.
