SPREADS
Sep/Dec corn spreads continue to have heavy volume, with nearly 80K traded Monday, and is trading from 12 1/4c to 12 1/2c today. The spread traded out to 13c before encountering short-covering activity. Short-covering was noted in corn yesterday, with September open interest declining by 31,196 contracts, while March picked up 12,656 new contracts. Bean spreads remain fairly quiet with Sep/Nov trading from 2 1/4c to 3 1/4c carry. Sep/Dec meal spreads are slightly narrower trading into $4.80 from $5.40.
PALM OIL
Prices gained on Tuesday after data showed that Malaysia's July exports grew 20% on the year to hit a record high of 1.78 mmt according to CGS-CIMB. Cash offers for RDB palm and olein on Tuesday were unchanged at $705.00/mt, and $707.50/mt, respectively.
NEWS
The Dow is up 340 pts with gold prices down $72.80 to $1951.60/oz. The US dollar falls to 93.17. The PPI rose a seasonally adjusted 0.6% in July, the biggest gain since Oct. 2018 as energy prices moved sharply higher.
CALLS
Calls are as follows:
beans: steady/firm
meal: .20-.30 higher
soyoil: 10-14 lower
corn: 1 higher
wheat: 3 1/2-4 1/2 higher
BUSINESS
USDA reports 132,000 mt of beans sold to China for 20/21
TECHNICALS
December Corn: Prices post a small rally, trading over the $3.20-$3.23 level which is now a small base of support. This turn higher from lower does open the door for prices to improve further and target $3.29/$3.30 where more selling interest could occur. Dec. corn may be in the process of setting an interim low, but that is probably determined by the market's reaction, (more short-covering?) post numbers. The yields would have to now be exceptionally bearish to create a new wave of selling.
first support: $3.23/$3.25
resistance: $3.28/$3.29
possible range: $3.24-$3.29
September Wheat: Could be in the process of forming a trading range low, with triple lows at $4.90 should the market hold today. Would look for more short-covering to lift prices towards $4.98/$5.05, and for pullbacks to probably hold given the fall as prices now look to work into consolidation mode.
first support: $4.92
resistance: $5.02
possible range: much the same or lower
November Beans: Likely working into a sideways range from $8.65 - $8.85. If short, would probably cover something as the $8.68-$8.71 level returns as a support zone. The market has not left its trading range in the broad sense from $8.65-$9.00, so an upward slant is not out of the question for the day.
key support: $8.69/$8.71
resistance: $8.79/$8.80
possible range: $8.69-$8.79/$8.80
December Meal: Prices posted a new ctr low at $286.20 with trade back towards $290.00. Would look for a pullback towards $288.00 to now offer up a chance to cover a short or try the long side of the market. The reversal suggests that a change of trend may be coming, which would at least take prices sideways from lower. Even if the market does break, the $285.00 level offers up long-term support.
first support: $288.00
resistance: $290.00/$281.00
possible range: much the same
December Soyoil: Prices are breaking down to test major support from 3040c to 3050c. The market is showing potential weakness by moving through 3050c, which is trendline support, but is so far staying above the 200- and 20-day moving average lines which cross at 3047c. Should prices take out all this support, it would generate a sell signal that could result in a larger sell- off to the bottom of the trading range at 30c, or even a move back to 2950c. In general, the chart is moving sideways from higher, stalling out the uptrend.
key support: 3040c-3045c
resistance: 3080c/3090c
possible range: 3045c-3090c
DECEMBER CORN
The major trend has been lower with the still unfilled gap from $3.42-$3.45 bearish, and therefore targeting lower trade with a test of ctr lows of $3.20. The price action seemed to get stuck at $3.20 lows, as shorts did not want to press into this level. As a result, a small base of trade has now formed from $3.20-$3.23, and price action today turns higher from lower. This will allow for the start of a trading range, and would expect a test of $3.29 once again based off today's more constructive outlook. If short, may want to lighten up a bit or even try the long side on a pullback towards $3.23.
TAGS – Wheat, Feed Grains, Soy & Oilseeds, North America
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