MarketEdge AM Comments
Jun 07, 2023
(Phil Knuth)
Good Morning. Corn and soybean futures finished the overnight session mostly lower, except for nearby soybeans. July corn was off 3 cents, settling at 6.05. July soybeans were up 1 ¾ cents, settling at 13.55. In the outside markets, as of 7:50am: The US Dollar Index is off 149 points, trading at 103.976. July crude oil is up 87 cents, trading at $72.61 per barrel. Precious metals are mixed. Industrial metals are higher, except aluminum. The Electronic Mini-DJIA is up 3 points, trading at 33,620. Weather continues to be the driving force behind grain and oilseed futures. All other factors that typically influence the market are taking a back seat and will likely stay back there until we get further along into the summer. Although there have been no major changes to the extended weather forecast models in the last 24-hours, some scattered precipitation across areas of the parched Eastern Corn Belt is providing a little bit of pressure to futures this morning. Coverage was spotty and rainfall totals were minimal, however, remember that Chicago’s mantra is “rain makes grain” and it is still a tad early in the growing season to become a bunch of Chicken Little’s and claim that the sky is falling and we are in for a crop failure due to dry weather. Going forward, more scattered precipitation is forecasted for the driest areas of the Corn Belt but there are still no major rain events forecasted in the near-term. Depending on which weather model you subscribe to, there may be some relief in the 6-10 and 11-15 day timeframes for the driest regions of the Corn Belt. Some models call for better rain chances while some remain dry. Such is the nature of a weather market… it really is akin to throwing a dart in the dark and then turning the lights on to see if you hit the target. Traders are anticipating Friday’s WASDE Report. For now, it is expected to be a bearish report, with carryout projections increasing from last month’s report. Yesterday, the funds bought 8000 contracts of corn, bought 1000 contracts of soybeans, and bought 1000 contracts of wheat. They are now estimated to be net short 41,850 contracts of corn, net long 12,240 contracts of soybeans, and net short 115,030 contracts of wheat. From a chart perspective, July corn faces initial resistance at yesterday’s high, 6.1150, followed closely by the six-week high charted on Monday, 6.14, and then 6.4750, the 3 ½ month high charted on April 18th. Initial support lies at 6.0450, the overnight low, followed by the psychological 6.00 mark, and then 5.7750, the two-week low charted one week ago. July soybeans face initial resistance at 13.6250, the overnight high, followed very closely by the three-week high charted yesterday, 13.64, and then the psychological 14.00 level. Initial support lies at 13.50, the overnight low, followed by yesterday’s low, 13.4025, and then the psychological 13.00 mark. Opening calls are steady.
Have a great Wednesday.
Good Morning. Corn and soybean futures finished the overnight session mostly lower, except for nearby soybeans. July corn was off 3 cents, settling at 6.05. July soybeans were up 1 ¾ cents, settling at 13.55. In the outside markets, as of 7:50am: The US Dollar Index is off 149 points, trading at 103.976. July crude oil is up 87 cents, trading at $72.61 per barrel. Precious metals are mixed. Industrial metals are higher, except aluminum. The Electronic Mini-DJIA is up 3 points, trading at 33,620. Weather continues to be the driving force behind grain and oilseed futures. All other factors that typically influence the market are taking a back seat and will likely stay back there until we get further along into the summer. Although there have been no major changes to the extended weather forecast models in the last 24-hours, some scattered precipitation across areas of the parched Eastern Corn Belt is providing a little bit of pressure to futures this morning. Coverage was spotty and rainfall totals were minimal, however, remember that Chicago’s mantra is “rain makes grain” and it is still a tad early in the growing season to become a bunch of Chicken Little’s and claim that the sky is falling and we are in for a crop failure due to dry weather. Going forward, more scattered precipitation is forecasted for the driest areas of the Corn Belt but there are still no major rain events forecasted in the near-term. Depending on which weather model you subscribe to, there may be some relief in the 6-10 and 11-15 day timeframes for the driest regions of the Corn Belt. Some models call for better rain chances while some remain dry. Such is the nature of a weather market… it really is akin to throwing a dart in the dark and then turning the lights on to see if you hit the target. Traders are anticipating Friday’s WASDE Report. For now, it is expected to be a bearish report, with carryout projections increasing from last month’s report. Yesterday, the funds bought 8000 contracts of corn, bought 1000 contracts of soybeans, and bought 1000 contracts of wheat. They are now estimated to be net short 41,850 contracts of corn, net long 12,240 contracts of soybeans, and net short 115,030 contracts of wheat. From a chart perspective, July corn faces initial resistance at yesterday’s high, 6.1150, followed closely by the six-week high charted on Monday, 6.14, and then 6.4750, the 3 ½ month high charted on April 18th. Initial support lies at 6.0450, the overnight low, followed by the psychological 6.00 mark, and then 5.7750, the two-week low charted one week ago. July soybeans face initial resistance at 13.6250, the overnight high, followed very closely by the three-week high charted yesterday, 13.64, and then the psychological 14.00 level. Initial support lies at 13.50, the overnight low, followed by yesterday’s low, 13.4025, and then the psychological 13.00 mark. Opening calls are steady.
Have a great Wednesday.