MarketEdge AM Comments

Oct 04, 2023

(Phil Knuth)

Good Morning.  Corn and soybean futures were mixed overnight.  December corn finished the overnight session off 2 cents, settling at 4.8550.  November soybeans were up 1 ¾ cents, settling at 12.7450.  In the outside markets, as of 7:45am:  The US Dollar Index is off 360 points, trading at 106.638.  November crude oil is off $2.17, trading at $87.06 per barrel.  Precious metals are higher, except gold.  Industrial metals are lower, except tin.  The Electronic Mini-DJIA is up 55 points, trading at 33,256.  A lower US Dollar Index overnight helped to ease the pressure on corn and soybean futures, however, rapid harvest progress, mostly “as expected” or “better than expected” yield reports from the field, and a struggling export program continue to weigh on futures.  Speaking of the struggling export program, recently reported flash soybean sales to China have been a positive export story.  For the last several months, Brazil has had a corner on the market, selling soybeans to China at quite a discount to the US.  Since they had a bumper crop, supplies were expected to last through the end of the year.  Chinese inquiries and purchases of US soybeans may be a signal that the Brazilian export program could be winding down.  Meanwhile, planters are rolling for the 2024 crop already in Brazil.  So far, the weather has been conducive to planting activity and additional acres are expected.  Yesterday, the funds sold 2000 contracts of corn, sold 3000 contracts of soybeans, and bought 2000 contracts of wheat.  They are now estimated to be net short 161,670 contracts of corn, net long 16,930 contracts of soybeans, and net short 108,420 contracts of wheat.  From a chart perspective, December corn finds initial support at 4.85, followed by the 4.75 area, and then 4.7375, last week’s low charted on Monday.  Initial resistance is at 4.8975, the double-high charted overnight and Monday, followed immediately by 4.9025, the one-month high charted on September 6th, and then the August 29th high, 4.9950, and the psychological 5.00 mark.  November soybeans find initial support at the overnight low, 12.71, followed by 12.5675, the double-low charted yesterday and on June 28th which is also a 3 ½ month contract low, and then the psychological 12.00 level.  Initial resistance is at 12.85, the overnight high, followed by the psychological 13.00 mark, and then 13.17, last week’s high charted on Wednesday.  Opening calls are mixed.
Have a great Wednesday.

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