Corn Futures (May)
Fundamentals: May corn futures made new contract lows yesterday as a global risk-off trade gripped the markets. Coronavirus concerns continue to be the leading catalyst as uncertainty grows. Though tough to quantify at this time, there is no denying it will have an impact on the global consumer. With that said, grain markets seem more isolated than other commodities.
Technicals: The market is firming up in the early morning trade, which is a silver lining, but the bulls will want to see confirmation through volume (participation) when the floor opens. Previous support now becomes resistance, 380 ¾-382 ¼ is the pocket we are eyeing.
Fundamentals: Soybeans got hit hard yesterday, trading to their lowest price since May. The spread of coronavirus has given the funds ammunition to add to their growing net short position. This is a very fluid situation and we expect it to keep volatility high(er), weekend risk premium will be taken more seriously which could make Friday’s and Sunday nights more interesting for the foreseeable future.
Technicals: The chart is undoubtedly bearish, but we have a hard time pressing the short side after falling nearly 90 cents to start the year. Four-star support from 880-883 managed to hold, if this gives way, we could see a retest of the May contract lows, 854.
Previous Session Bias: Neutral
Resistance: 898 ¼-900**, 914-917****, 928-930 ¾***
Pivot: 890-890 ¾
Support: 880-883****, 850-854****
Chicago Wheat (May)
Technicals: May wheat futures broke lower yesterday, carrying over into overnight/early morning weakness. Our target of the mid-520’s is all but achieved. If you were short, you may consider reducing a portion of your position. We still like reselling rallies, so we will want to be ready, willing, and able to add if we see relief.