Technical support areas in corn breached yesterday brought a flood of suspected
Fund selling. CN21 off the 40¢ limit at one point and settled near that at 38¢
lower. Favorable weather outlook also a contributing factor.
Funds down as sellers of 40K contracts of corn yesterday. We have them now net long 224K contracts. One firm suggesting Fund sold as much as 70K contracts.
Huge, suspected Fund selling in corn, yet Open Interest was UP near 4K contracts yesterday. Some new shorts as well I suspect.
At 0630 CN21 trading 3 3⁄4¢ higher at $6.24 and has seen a 9¢ range. SN21 giving up 4 1⁄2¢ at $15.07 inside a 17 1⁄2¢ range. KC wheat off 3 1⁄2¢.
Dow futures 63 points higher at 34,322. Crude off 20¢ at $65.87. US $ index showing modest gains.
Dalian corn futures lower overnight. Since early January, corn futures on the Dalian exchange have been making a series of lower lows and lower highs. If the pattern holds, a further price break of near a buck a bushel equivalent is shown.
A 50% retracement of the entire $3.89 corn rally would be $4.95 1⁄4. That price level also coincides with the high end of a near 3-month long period of price consolidation. Without a significant weather distraction, as good a target as any.
Corn has seen a below trend yield the last two years. Longest below trend corn yield streak since ’88 was the 4 yrs. 2010 to 2013. Odds say above trend this year.
SXSF hit 1¢ carry yesterday and overnight. Not much trading at that level. New crop corn spreads reluctant to widen on the price break.
NOAA 7-day forecast has some big rain for KS and S NE. Modest amounts for the corn belt. Least amount perhaps where they need it the most in ND.
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