March Corn closed 4 ¾ cents lower ($3.76 ½), July 4 ¾ cents lower ($3.92 ¾) & Dec 3 ¾ cents lower ($4.00)
February Chgo Ethanol closes 0.012 cents a gallon higher ($1.279) & March 0.001 cents lower ($1.289)
It looks like the corn market ran into to some month-end profit taking. The word on the street is that everyone has some corn in their back pocket. Weekly export sales as of December 20th looked okay on paper but it is old news. Argentina (BAGE) increasing the size of their corn crop doesn’t help (43.0 M T. to 45.0 M T.). Trying to interpret commentary out of the WH as to how the China/US trade talks are going is a lesson in frustration. He wants a deal but not sure he’ll get it; maybe postpone it for the time being. Another source of frustration; will the government shut down again after February 15th? If so that would stop the flow of information that just got started up this week in an incremental fashion. At least we we’ll get some info on February 8th. To my knowledge the trade is still anticipating a drawdown on last year’s crop size.
Cash corn movement has come to a screeching halt. Many interior locations are closed due to the weather. River locations are dealing with ice problems. The Gulf continues to be “relatively” firm due to these weather related issues moving grain to the Gulf. I’m told demand is no big deal. Spreads continue to be sideways to lower.
The technical look has not changed; a broad sideways that features triangulation (higher lows and lower highs). Today’s low and close in March corn is the lowest for the past two weeks (if that means anything to you). Some may view that as a “negative” but I doubt we sustain any kind of major break ahead of the USDA on February 8th. The best MO for trading sideways markets is fading short term inter-day extremes and we’re close to a downside inter-day short term extreme as I write this. Bottomline – don’t chase the short term extremes.
Daily Support & Resistance for 02/01
Mch Corn: $3.73 – $3.80 July Corn: $3.89 – $3.96
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 future results.