GOOD MORNING,

Prices are still attempting to flesh out trading range lows, with technical reversal signals kicking off the liquidation.  Funds are lightening up on length selling another 5K of wheat, 7K beans, 1000 meal, 4K soyoil, and 15K corn yesterday.  Today would be day 3 of fund selling, and if short would probably look to find some technical stabilization at the lows of today.   The absence of business announcements continues to find beans struggling, as China's deteriorating crush margins create a wait-and-see attitude.  Better rains are crossing SA as well.  

In political news for the US, Biden said he would not drop Phase 1 China tariffs immediately.  In global news, a worker strike in Argentina has halted activity in some of the major ports such as Rosario, which handles around 80% of grain exports.  The Rosario Grain Exchange reported that only 1300 trucks entered export terminals Tues. which was 45% lower than week ago. 

WEATHER

Remains mixed for SA crops with just enough rainfall to help to alleviate some dryness.  Rains will expand into Mato Grosso and surrounding areas over the next few days, where Brazil will get better rains while Argentina turns drier.  

REPORTS

October Census crush came in within trade expectations at a record 196.5 mln bu vs. 171.0 mln in Sep, and vs. year ago at 187.10 mln bu.  Oil stocks were higher than expected at 1.963 bln lbs, which was 50 mln above the average trade guess, and vs. 1.848 bln in Sep.  Meal stocks were 343 tst vs. 313 tst in Sep.  Gist of report is friendly for beans but bearish soyoil and oilshare.  USDA Grain crushing found Oct. corn for fuel at 432.713 mln bu.  

ANNOUNCEMENTS

Brazil's ANEC forecast 1.338 mmt of corn to be exported for the week ending Dec. 5.

Brazil's Datagro forecast the total corn crop at 114.0 mmt, down from 114.5 mmt prev.  Brazil was forecast to have exported 4.9 mmt of corn for Nov., vs. 4.1 mmt yr ago.   Datagro forecasts the 20/21 bean production at 134.98 mln mt vs. 134.44 mln mt.   

CALLS

Calls are as follows:

beans:  12-14 lower

meal:  6.00-7.00 lower

soyoil:  10-15 lower

corn:  3 1/2-4 lower

wheat:  1-1 1/2 higher

OUTSIDE MARKETS

Slightly weaker after the NASDAQ and S&P's traded into all-time highs yesterday.  The Dow is slightly lower this morning down 130 pts, while the US dollar trades to 91.10.  Crude trades down to $43.92/barrel. 

TECH TALK

• Markets violated first key support levels for Jan beans at $11.60, Jan meal at $386.00, Jan soyoil at 37c, and March corn at $4.20.  First target lows are now $11.38 Jan beans, $380.00 Jan meal, 3650c Jan soyoil, $4.10 /$4.12 March corn, and $4.71 March wheat, so would not be surprised to see prices begin to stabilize today as we either hit or approach these prices.
• March wheat extends losses but may be entering oversold status.  March wheat prices continue to head lower posting double lows at $5.74 3/4.  However, the best support is a move down to $5.71 where the 100-day moving average is located.  The market has still yet to stabilize, but may begin to do so at this level.  
• March corn breaks major support at $4.20, which opens the door towards the next major support level at $4.10 - $4.12.  The uptrend has now weakened with the ADX falling to 28.  March corn continues to attempt to find its trading range low, which may not come into play until we reach $4.10/$4.11.  Would look for $4.10-$4.12 to offer up good support as it is also the 38% retracement from the low of the rally at $3.95 up to current ctr highs of $4.39 1/2. 
• Jan beans are still attempting to find the low end of the range, and trading below $11.50 moved it through the 20-day moving average and down towards the next may major support level which appears to be from $11.25-$11.30.  Think that $11.38/$11.40 should find some initial support as well, and if short would probably cover something in.  
• Jan meal breaks key support at $386.00 to touch major trendline support at $380.90.  The ADX remains strong here at 47, meaning buyers could be looking for a spot to own.  If needing to price, the break takes prices right to major trendline support and would take advantage.   Any violation of major support at $380.00 will find end-users more patient, as then there would be nothing to stop a fall towards $365.00/$370.00.  
• Jan soyoil has traded near a major cycle low of 3650c.  If short, would cover something in or try the long side of this market.  Prices did manage to bounce off 3650c, though there could be more liquidation from funds who remain extremely long here. 

JANUARY BEANS

The contract high at $12.00 and the break of the uptrend channel, (started with an outside day closing lower from that channel break), now finds the market searching for a bottom low.  The ADX still remains fairly strong at 49, meaning that buyers will still be looking to own something when prices do appear ready to stabilize.  In the meantime, best support appears to be around the $11.25 level should prices close on the lows again.  The sell-off now corrects all overbought conditions.  Since the ADX remains strong, would be scale-down covering a short from $11.25-$11.40, and would not be surprised to see today's lows hold for the week wherever we may land.  If doing a Fib. retracement from the low of $10.50 to $12.00, the 38% level would be $11.37, 50% at $11.13, and 62% at $10.98.  Since this has been such a dynamic bull market, would look for 38% to hold well first time around, and we are nearly there.

ON THE CALENDAR

EIA report has advertised expectations for ethanol production to be down 1-2% with inventories perhaps building by the same. 

TAGS – Feed Grains, Soy & Oilseeds, Wheat, North America