Dec Corn closed 3 ¾ cents higher ($3.88 ¾), March 3 cents higher ($3.97 ¼) & July 2 ½ cents higher ($4.05 ¼)
November Chgo Ethanol closed $0.005 cents a gallon lower ($1.376), Dec $0.005 lower ($1.355)
Weekly Corn Export Sales – old crop vs. 700 K – 1.500 M T. expected – new crop vs. none expected
It’s all about the possibility of further Chinese demand and the possibility of a deeper than expected cut to production on Friday’s USDA update. As the market moves higher open interest rises which is indicative of a bone fide bull market. Additionally as the market rises spreads tighten which is another indication of a bull market. So here have two rationales working; better demand and a shorter supply. All we need now is for the USDA to confirm all of this. Failure to see this will bring about a sharp correction given the big influx of spec longs.
Interior cash corn markets (basis) in the Midwest don’t do a whole lot day-to-day. The Gulf strengthens from Hurricane fears this weekend for quick shipment as well as the idea that not that much corn is actually moving. It seems the producer has gotten bullish with the ongoing flat price rally and he is willing to sit on his corn.
After the bullishly construed Stocks report of last week the idea had Dec corn heading to the low $3.90’s – we’re there. A technical count of the correction prior to the Stocks report measures something closer to $4.00. It is my thought it will take something from the USDA on Friday to get us there if not beyond. If the USDA fails to confirm the current bullishness of the market 10 cents can come out very quickly if not 20 cents.
Daily Support & Resistance – 10/08
Dec Corn: $3.83 – $3.95 (?)
March Corn: $3.92 – $4.03 (?)
The risk of trading futures and options can be substantial. Each investor must consider whether this is a suitable investment. Past performance is not indicative of eclipse the high side of expectations.