Opening Calls – October 12, 2018 at 7:55 AM
Firmer tone in the overnight. Corn has fallen back to a tick lower early Friday, but beans and wheat are holding nickel gains as traders digest the latest USDA WASDE. Attention should turn back to harvest progress as temperatures turn colder and snow becomes an issue in areas of the Midwest.
Charts of the Day – October 12, 2018
Afternoon Market Commentary – October 12, 2018
by: Chris Betz
|Old Crop (futures month, change, settle price)||CZ8||4’4||373’6||SX8||9’2||867’4||WZ8||9’2||517’2|
|New Crop (futures month, change, settle price)||CZ9||2’2||404’4||SX9||7’2||932’2||WN9||7’4||555’4|
Positive close to the week as traders have had a day and a half to digest yesterday’s WASDE report, and turn their attention towards harvest delays. Some rain and snow in spots over the weekend lent support for Friday’s trade.
After sharply lower days, the Dow Jones Industrial Average is at least trading higher to end the week as traders are looking to buy the bottom of the move. This will have lessoned pressure on commodities Friday, which are mixed in general.
News Thursday of a possible meeting late November between President Trump and Chinese President Xi Jinping is positive, but isn’t a real surprise to the trade as a resolution is not expected until at least after Midterm election early in November.
December corn closed just below key resistance at the 100 day moving average. Next resistance would be around the 200 day moving average at 387’6. The higher close on the weekly continuous chart is also favorable, but trade failed to touch resistance at 374’2, which is the four-month high. Those needing to price bushels vs the Dec should do so now, and then target 385 for additional sales.
November soybeans made a nice jump over Thursday and Friday, but remains well below resistance around 870, then the 100 day at 890. Still, target 907, then 936 as the seasonal low looks to be put in.
Wheat closed lower on the week despite Friday’s gains as trade is seeking direction. World spring wheat harvest is nearing completion, and traders will be looking for winter wheat planting implications with delays corn beans harvest.
Technical Thoughts – October 12, 2018
By: Ken Lake
Even though USDA raised projected ending stocks and yield in both corn and soybeans both numbers were slightly below average trade guesses resulting in higher markets today. This action reinforces my notion that seasonal lows were scored back on September 18th.
Long-term support in November soybeans is 812. Short-term support is the 20 day moving average at 849. Resistance is the 50 day moving average at 858. I am adjusting upside targets a bit lower simply because of this week’s weak action. Target 892, 907, 936.
Long-term support in Dec remains 342. Short-term support is 360, but today we traded and closed over the 50 day moving average at 366. Target 374, 385.
December 2019 traded 403 today. That’s a good place to add to your hedges for next year.
December wheat support is 489. This contract is oversold. No sales recommendations at this time.
July 2019 wheat broke short-term support this week at 550 and points lower. No sales recommendations at this time.