It’s been a mixed bag in the overnight trade between corn, beans, and wheat. Here are a few things we are keeping an eye on in today’s trade.
Corn
Tuesday’s Recap
Dec Corn futures settled at 413’6 Tuesday, up 3’0, in mostly higher trade. Across all maturities, 366,390 contracts were traded, with 197,431 done in the Dec maturity. Overall open interest closed at a contract high of 1,683,306, up by 341 (0.0203%). Dec open interest decreased 11,050, or 1.53%, to 712,957.
Technicals
December corn futures were able to find their sea-legs in yesterday’s trade but that has failed to spill over to strength in the overnight trade. Our pivot pocket from 413-416 has proven to be a brick wall (for now) and will continue to be watched closely into the back half of the week. A continued failure here keeps the downside risk open down to first support, 406 1/2-408 1/2. If the Bulls can chew through and close above the pivot pocket, a run and retest of the recent highs seems probable, that comes in from 425-426 1/2.
Technical Levels of Importance
Resistance: 425-426 1/2***
Pivot:413-416
Support: 406 1/2-408 1/2, 397-401 1/4*
Popular Options
Option trading centered around the Dec 420 calls with 7,603 traded and the Dec 400 puts with volume of 4,255. Options with the most open interest are the Dec 430 call with 32,005, and the Dec 400 put with 37,549.
Volatility Update
Implied Volatility closed the session slightly higher with CVL up by 0.089, to finish the day at 19.14. The 30-day historical volatility closed the session up by 0.16% to a one month high of 18.72%. The CVL Skew was sharply higher with the 30-day adding 0.46, closing the day at 1.19.
Seasonal Tendencies Update
Below is a look at historical price averages for March corn futures on a 5, 10, 15, 20, and 30 year time frames (Past performance is not necessarily indicative of future results). The chart seems to indicate that November can be a tough time for the market to stage a meaningful rally. Whether or not that plays true this year is TBD.
Wheat
Tuesday’s Recap
Wheat futures were higher Tuesday with the Dec contract finishing the session at 570’4, up 11’6, or 2.10%. Across all maturities, volume was 125,918, with Dec seeing 67,415 done. Overall open interest dropped 585 (0.14%) to end the session with 415,985 outstanding. The Dec maturity decreased 2.53%, or 585, to finish at 198,434.
Technicals
Wheat futures had an impressive move higher in yesterday’s trade which carried into some initial strength in the overnight session, but that has turned to weakness in the early morning. The first barrier that the Bulls want to get out above comes in from 582 3/4-584 1/4. If achieved, it would likely keep the door open for a move back towards the psychologically and technically significant $6.00 area. On the flip side, a failure against the Monday/Tuesday lows opens the door for a drop to 544 1/4.
Technical Levels of Importance
Resistance: 596-600, 615-617 1/2, 629 1/2-634
Pivot: 582 3/4-584 1/4
Support: 557 1/2-560 1/2, 544 1/4***
Popular Options
The Dec 500 put saw the most traded with 1,266 contracts changing hands. Options with the most open interest are the Dec 600 call with 8,345, and the Dec 550 put with 7,404.
Volatility Update
Implied Volatility ended the session up with WVL higher by 0.67, to close the day at 29.68. Up 0.92%, historical volatility (as measured by the 30-day) settled at 24.99%. The WVL Skew was moderately higher with the 30-day gaining 0.48, closing at 6.09.
Seasonal Tendencies Update
Below is a look at historical price averages for March wheat futures on a 5, 10, 15, 20, and 30 year time frames (Past performance is not necessarily indicative of future results).
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