MarketEdge AM Comments
Feb 14, 2024
(Phil Knuth)
Good Morning. Corn and soybean futures were lower overnight. March corn finished the overnight session off 2 ¾ cents, settling at 4.28. March soybeans were off 3 ¼ cents, settling at 11.83. In the outside markets, as of 7:40am: The US Dollar Index is off 120 points, trading at 104.837. March crude oil is up 32 cents, trading at $78.19 per barrel. Precious metals are mixed. Industrial metals are mixed. The Electronic Mini-DJIA is up 103 points, trading at 38,436. If the proverbial “wheels” of the bus with corn and soybean futures aboard as passengers came off a while ago, last night the bus itself fell apart. All that may be left are a few seats and the floor and you can forget about a steering wheel! Where is the bottom? Every time that it feels like we have reached the point at which futures will now consolidate above lows that have been charted, those key support levels get taken out and we chart new lows. Last night, March corn charted yet another new contract low and March soybean futures charted another new eight-month low within 30 cents of testing the contract low. Unfortunately, there is a lack of friendly fundamental news out there that could stop the hemorrhaging. Corn and soybean futures need a tourniquet, and fast, but the medic who could apply one apparently forgot to show up to the battlefield. Tomorrow, USDA will release preliminary, unofficial projected balance sheets at the Ag Outlook Forum. The range of trade expectations for the 2024/25 corn carryout projection is 2.5-2.8 billion bushels. The range of trade expectations for the 2024/25 soybean carryout projection is 400-420 million bushels. For frame of reference, the current 2023/24 corn and soybean carryout projections are 2.172 billion bushels and 315 million bushels, respectively. “Yikes!” is about all I can say about those figures. Yesterday, the funds bought 1000 contracts of corn, sold 2000 contracts of soybeans, and sold 1000 contracts of wheat. They are now estimated to be net short 297,680 contracts of corn, net short 129,160 contracts of soybeans, and net short 69,320 contracts of wheat. From a chart perspective, March corn finds initial support at the new contract low charted overnight, 4.27. Further support levels from the continuous corn chart lie at 4.09 and 3.93. Initial resistance is at 4.31, the overnight high, followed by 4.3475, yesterday’s high, and then the double-high charted on Thursday and Friday, 4.37. March soybeans find initial support at the new eight-month low charted overnight, 11.7575, followed immediately by 11.7525, the June 8th low, and then the contract low charted on May 31st, 11.4525. Initial resistance is at 11.8625, the overnight high, followed by the psychological 12.00 mark, and then 12.0550, last week’s high charted on Tuesday. Opening calls are lower.
Have a great Wednesday.
Good Morning. Corn and soybean futures were lower overnight. March corn finished the overnight session off 2 ¾ cents, settling at 4.28. March soybeans were off 3 ¼ cents, settling at 11.83. In the outside markets, as of 7:40am: The US Dollar Index is off 120 points, trading at 104.837. March crude oil is up 32 cents, trading at $78.19 per barrel. Precious metals are mixed. Industrial metals are mixed. The Electronic Mini-DJIA is up 103 points, trading at 38,436. If the proverbial “wheels” of the bus with corn and soybean futures aboard as passengers came off a while ago, last night the bus itself fell apart. All that may be left are a few seats and the floor and you can forget about a steering wheel! Where is the bottom? Every time that it feels like we have reached the point at which futures will now consolidate above lows that have been charted, those key support levels get taken out and we chart new lows. Last night, March corn charted yet another new contract low and March soybean futures charted another new eight-month low within 30 cents of testing the contract low. Unfortunately, there is a lack of friendly fundamental news out there that could stop the hemorrhaging. Corn and soybean futures need a tourniquet, and fast, but the medic who could apply one apparently forgot to show up to the battlefield. Tomorrow, USDA will release preliminary, unofficial projected balance sheets at the Ag Outlook Forum. The range of trade expectations for the 2024/25 corn carryout projection is 2.5-2.8 billion bushels. The range of trade expectations for the 2024/25 soybean carryout projection is 400-420 million bushels. For frame of reference, the current 2023/24 corn and soybean carryout projections are 2.172 billion bushels and 315 million bushels, respectively. “Yikes!” is about all I can say about those figures. Yesterday, the funds bought 1000 contracts of corn, sold 2000 contracts of soybeans, and sold 1000 contracts of wheat. They are now estimated to be net short 297,680 contracts of corn, net short 129,160 contracts of soybeans, and net short 69,320 contracts of wheat. From a chart perspective, March corn finds initial support at the new contract low charted overnight, 4.27. Further support levels from the continuous corn chart lie at 4.09 and 3.93. Initial resistance is at 4.31, the overnight high, followed by 4.3475, yesterday’s high, and then the double-high charted on Thursday and Friday, 4.37. March soybeans find initial support at the new eight-month low charted overnight, 11.7575, followed immediately by 11.7525, the June 8th low, and then the contract low charted on May 31st, 11.4525. Initial resistance is at 11.8625, the overnight high, followed by the psychological 12.00 mark, and then 12.0550, last week’s high charted on Tuesday. Opening calls are lower.
Have a great Wednesday.