Graincast: Corn under pressure

CORN
 

Corn (CBOT:ZCN14) saw early pressure yesterday but rallied to close just ¼ of a cent lower at $4.65 ½. Plant progress showed that we are currently 95% planted versus the five year average of 94% with emergence right in line with the average of 80%.

Crop progress is looking good to start; we are at 76% good/excellent which is well above last year’s 63% and the 5 year average of 70%. There are still 2 million unplanted acres in states that were experiencing poor weather conditions; we may see up to 500k be reallocated to this year’s soybean crop. Traders will continue to pay close attention to weather conditions across the Midwest. Moisture is good, but too much rain could lead to washouts. The market continues to consolidate below resistance at 465-468 and only a close above here will break the immediate term bearish momentum.
 

Resistance – 465-468**, 472-4***, 476*, 480**, 490-6***, 495-496-48, 500-502-6**, 508-6**

Support –456-4**, 421-6***  
 

SOYBEANS
 

Soybeans (CBOT:ZSN14) had a nice midafternoon rally yesterday (33 ½ cents off the lows) before pulling back to close at $15.00 ½ . Funds were estimated buyers of around 2,000 contracts yesterday on better than expected export inspections.

Soybean planting is now at 78% complete vs. the average of 70%. Emergence is at 50% which is 5% ahead of the average. We may start to see funds roll out of old crop and in to the Nov. contract. November beans have rallied at least $1.75 in 7 of the last 7 years. Those traders trading the July/November spread saw it increase yet again, it widened by 11 ¼ cents to $2.70 ¾.

We have seen a choppy trade that tested as high as 1511-6 yesterday after holding a low of 1478-2 early in the session. The trade has consolidated back below 1500 entering this morning and close above resistance at 1497-1500 will be paramount for the bull camp. A close back below 1483 will signal a heavy trade and a slight failure at higher price levels.
 

Resistance –1497-1500***,1507-6*,1512**, 1521-1526-2***, 1590***, 1630***

Support –1483**, 1473-4-1476*, 1460-4-1462-4***


WHEAT
 

Wheat continued to add to its losses yesterday with the July contract closing down 6 ½ cents at $6.20 ¾ . Spring wheat (CBOT:ZWN14) planting is at 88% complete with emergence at 67%. Winter wheat is rated at 30% g/e which is unchanged from last week.

Russia and Ukraine were in wheat market news yesterday, but not for tensions; both are expecting 6 year highs for crop production which also helped pressure the market. Funds were estimated to have sold 3,000 contracts on the session.Wheat continues to hit support at the 610-4-616 as we have seen a low of 616-2 with the market finding buyers stepping in at these oversold conditions. Only a close back above 625-2 will help encourage a consolidation off of this major support level.
 

Resistance – 625-2*, 636-4**, 641-2**, 659-2- 661***, 672-4-674-2*, 684-687-4**, 698-700***

Support –610-4-616***, 594-4**, 572-2

About the Author
Rich Ilczyszyn

Rich Ilczyszyn is Founder and Chief Market Strategist of iiTRADER.com. Rich excels at creating dynamic trading strategies for clients that establish solid positions, while remaining flexible enough to capitalize on market opportunities when they arise. By identifying market trends, breakouts, and failures in a timely fashion, Rich presents clients with the opportunity to realize their objectives while effectively managing their risk.

Rich is featured expert/trader and contributor on CNBC's "Futures Now" Show, and has been quoted in multiple of top-tier publications, including: The Wall Street Journal, Associated Press, Bloomberg News and Reuters.

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