Grain markets get hit hard yesterday but are able to hold ground in the overnight and early morning trade.
Corn
Technicals (March)
March corn futures got hit hard yesterday, marking new contract lows yet again. The Bulls certainly have their work cut out for them to turn the technicals more favorable, consecutive closes above 462-467 would be a start. On the support side, we are in unchartered territory, so finding meaningful support based on previous interactions between buyers and sellers becomes more difficult. 450 is the psychological line in the sand that many participants will be inevitably watching.
Bias: Neutral/Bullish
Resistance: 481-484***, 493-496 1/2****
Pivot: 462-467
Support: 450**
Seasonal Tendencies
Below is a look at historical seasonal averages for March corn futures (updated each Monday) VS today’s prices (black line).
*Past performance is not necessarily indicative of futures results.
Commitment of Traders Snapshot
(updated on Mondays)
Below is a snapshot of the most recent Commitment of Traders report which showed Managed Money (Funds) were net sellers of roughly 17k futures and options contracts, expanding their net short position to 197k contracts. At the end of November, they were as short as 206.5k contracts, which was the largest net short position since 2020.
Soybeans
Technicals (March)
March soybean futures continued to slide lower in yesterday’s trade but are holding ground in the early morning trade. With that said, they were holding ground early yesterday morning too, then accelerated to the downside on the 8:30am open. The Bulls will want to see a close above 1250-1260 to help halt the hate selling. A failure to do so keeps the bears in full control with the next support pocket coming in from 1230-1235, which the market came within a penny of in yesterday’s trade.
Bias: Neutral/Bullish
Resistance: 1282-1285***, 1295-1300****, 1325-1330***
Pivot: 1250-1260
Support: 1230-1235***
Seasonal Tendencies
Below is a look at historical seasonal averages for March soybean futures VS this year’s price (black line), updated each Monday.
*Past performance is not necessarily indicative of futures results
Commitment of Traders Snapshot
(updated on Mondays)
The most recent Commitment of Traders report showed funds were net sellers again, for the seventh consecutive week. The are seen holding a net short position of 11,629 futures and options contract, broken down that is 69,804 longs VS 81,433 shorts. This is the largest net short position since 2020.
Wheat
Technicals (March)
Wheat futures traded lower yesterday, in tandem with the bulk of the grain complex. With that said, the pullback in wheat was perhaps the least destructive in terms of the charts. The pullback brought us back near the 50% retracement, derived from the November lows to the December highs, which also coincides with the psychologically significant $6.00 level. Just below this is our 3-star support pocket from 591 1/2-595. Despite the doom and gloom in the grain trade, this may setup for a halfway decent risk/reward opportunity to the buyside. A break and close below support would neutralize that bias and likely lead to a retest of the recent lows.
Bias: Neutral Resistance: 618-622***, 637-639**, 645-650*** Pivot: 608 1/2-611 Support: 591 1/2-595***, 570**
Seasonal Tendencies
Below is a look at historical seasonal averages for March Chicago wheat futures VS this year’s price (black line), updated each Monday.
*Past performance is not necessarily indicative of futures results.
Commitment of Traders Snapshot
(updated on Mondays)
The most recent Commitment of Traders report showed fund positioning little changed from the previous week. Managed Money are still holding a net short position to the tune of about 60k futures and options contracts. Broken down that is about 130k shorts VS about 70k longs.
Oliver Sloup, VP & Co-Founder, Blue Line Futures