FOR TUESDAY: (2/21 no change) Three-day weekends are tricky to trade. Grains are oversold and if they crash Monday night on bearish weather, they will have to bounce on Tuesday. Hogs look higher for a few days and have to wait for the dust to settle on cattle but seeing lower prices on Tuesday and willing to sell a key pattern completion on the feeders.
MARCH CORN (electronic ok)
TODAY’S COMMENTS: (2/21) Corn moving toward key support at 366-67. The fact that a 13-cent, 4th-wave correction is happening so quickly makes us wonder if we can still get a new high. Corn is often up in March and this year’s pattern might allow a rally in April although we have to do more work. We will cover hedges at the end of the month but still give corn a chance to break the key 365 area. USDA Outlook report will be key next week.
WEEKLY CHART: (2/10) Close above 375 may be starting to project upper target of 389. We usually get a break in Feb but it doesn’t always happen. Taking out the weekly chart trendline at 351 will be important to allow for something more dramatic to the downside and unlikely to happen with firming exports and hopes for China. With 2.3 billion bushels likely leftover Sept. 1 from the huge 2016 crop, it’s hard to forecast a big rally without weather. But July futures appears to be adopting the pattern seen in yields of rising prices, and December is following the path normally seen to post gains into March/April. Fundamental value could get up to $4.20 to $4.55. The bottom end of the range could come in by April but we will need weather problems in June—and they are coming to get up to 4.50.
CYCLES OVERVIEW: Bottoming Feb. 20 (evening session); recovering higher Feb. 21.
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