Dec Corn closed 2 ¼ cents lower ($3.72), March 1 ½ cents lower ($3.82 ¾) & July 1 ¼ cents lower ($3.97)
Jan Chgo Ethanol closed 0.038 cents a gallon lower ($1.229), Feb 0.038 cents lower ($1.264)
USDA announces 198.1 K T. of corn sold to Mexico – 106.68 K T. old crop, 91.44 K T. new crop
Weekly Corn Export Sales – old crop vs. 800 K – 1.100 M T. expected – new crop vs. none expected
Despite finishing the day lower the price action suggested the willingness of the trade to continue to cover shorts. Corn futures got hit relatively hard to start the day session. Fears that the China/US trade talks may break down again was the rationale. A Chinese executive was arrested overnight in Canada for extradition to the US for violating US sanctions to Iran. Supposedly they were selling US goods into Iran. Shortly after the opening corn futures were down 4 cents or so. That level, however, was quickly rejected and the majority of the session was spent trying to retrace those losses. By midday prices traded fractionally higher. From there prices eased going into the close. Direct corn news ran mixed on the day – a higher Ukraine corn crop, a lower Canadian corn crop, a small announced sale to Mexico and US ethanol prices back down to recent contract lows. Tomorrow will feature weekly export sales and whatever new happenings involving China and the US trade developments.
The interior corn basis has a mixed look to it has valuations are gyrating back and forth. The underlying trend, however, remains higher. The Gulf corn basis has gone into a flip-flop mode; higher to lower to higher to lower. Corn spreads ran fractionally softer on the day; still in an area we’ve been in for months.
Technical considerations are based on price action not politics in the market place. Corn charts still read higher as attempts to sell off keep finding support. The recent Friday to Sunday night gap below current prices remains intact. As long as it remains intact the bias will be for higher prices. $3.78-$3.79 continues to be a hurdle on the weekly charts just as $3.90 is for March corn.
Daily Support & Resistance for 12/07
Mch Corn: $3.80 ½ – $3.88
July Corn: $3.94 – $4.02
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.