Dec Corn closed 3 cents higher ($3.74 ¼), March 2 ¾ cents higher ($3.84 ¾) & July 2 cents higher ($3.98 ¼)
Dec Chgo Ethanol closes 0.005 cents a gallon higher ($1.235), Jan 0.004 cents higher ($1.272)
Technical considerations (strong looking price charts) continues to prompt spec/fund short covering in the corn market. I did not see any new fundamental news of note to support today’s strength. A lack of deliveries against the December contract was cited by some as a supporting issue. Weather in SA is okay for now but I’m told a dry bias could be developing over the near term. To date the developing corn crop in both Brazil and Argentina has seen very few issues.
The interior corn market shows us another mixed performance on the day. As locations roll their basis to the March contract I’m seeing improvements as well as declines. The Gulf rolled to March yesterday and that reflected a 2-3 cent improvement. Bull spreads were working noticeably on Wednesday. Corn spreads are trying to show a minor upside bias over the last couple of weeks but overall we’re not anywhere different vs. the past few months.
March corn registers its best close dating back to Nov 8th, USDA crop report day. Following that close futures dropped 17 cents and its just in the past 5 days we’ve recouped those losses. Needless to say it’s a strong looking price pattern. March corn appears headed for a test of the mid-low $3.90’s; a level that has provided resistance dating back to mid-August. Next Tuesday, the 11th, the USDA will update Supply-Demand tables. This is not a “production” report. As of this writing my thought is we’ll see minimal if any changes.
Daily Support & Resistance for 12/05
Mch Corn: $3.77 – $3.86 ½
July Corn: $3.91 – $4.00 ½
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.