Grain markets have had a choppy start to the week as traders await new news from the USDA. Here’s a few things to keep an eye on for today’s trade
Monday’s Ag Market Recap & WASDE Estimates
Grains were uniformly higher early this morning but some of that strength fizzled as positioning squaring ahead of Tuesday’s WASDE may have capped upside movement. Livestock markets were mostly mixed with little new news.
Corn
Monday’s Recap
Monday’s Corn market was higher with the March contract up by 1’6 to 441’6, a one week high. Total volume was 388,982, with the March contract seeing 228,237 change hands. Overall open interest increased by 7,416, or 0.48%, with March dropping by 1,639 (0.20%) to 798,831.
Technicals
March corn futures continued to grind higher yesterday, stalling in our resistance pocket pretty perfectly (blind squirrel finds a not every now and again) which we’ve outlined as 441 3/4-442 1/4. If the Bulls can chew through and close above here the next upside objective is within arm’s reach, from 447 3/4-452 1/4. A breakout above there could spark a more meaningful move to the upside as there is quite a bit of air on the chart from the June selloff. With that said, producers/hedgers may want to look at resistance levels as an opportunity to protect price. Options can be a great tool for that in this environment. A close back below our pivot pocket likely takes us back to trendline support.
Technical Levels of Importance
- Resistance: 441 3/4-442 1/4***, 447 3/4-452 1/4****
- Pivot: 434-437 1/2
- Support:425 1/2-428***, 423 1/4**, 414-416 3/4****
Fundamental Notes
- Importers in Spain are buying U.S. corn at a pace not seen in at least six years, as high South American prices and crop quality concerns in Ukraine prompted a shift away from the country’s traditional suppliers, traders and analysts said on Monday. In the past two weeks, the importers have booked purchases totaling about 400,000 to 500,000 metric tons of corn from the United States, likely for shipment in the first quarter of the new year, two European traders said. -Reuters
- Weekly Export Inspections: 1,049,690 MT. Above Last week’s 948,812 MT and within the range of expectations.
Popular Options
Option volumes were highest for the March 450 call (5,904) and the March 420 put (4,650). Options with the most open interest are the March 450 call with 47,173, and the March 420 put with 29,298.
Volatility Update
Corn implied volatility ended moderately up as CVL added 0.19 to close the day at 16.60, a one week high. Historical volatility (30-day) finished the session at 16.64%, down by 0.39%, to a one week low. The CVL Skew was higher with the 30-day adding 0.17, closing at a one week high of 1.59.
Seasonal Tendencies Update
(Updated on 12.9.24)
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). Historically, December has been a favorable month for prices. Whether or not that stays on trend this year or not is still to be seen.
Commitment of Traders Update
(Updated on 12.9.24)
Friday’s Commitment of Traders report showed Funds were net sellers of roughly 9.2k futures/options contracts, shrinking their net long position to 88,220.
Ready to dig in?
Subscribe to our daily Grain Express for fresh insights into Soybeans, Wheat, and Corn. Get our expert technical analysis, proprietary trading levels, and actionable market bias delivered right to your inbox.
Sign Up for Free Futures Market Research – Blue Line Futures