Outside Markets Main Driver of Grain Prices
Outside Markets: Outside markets were mostly stable yesterday and holding their own in the early morning trade. The fact that we are not seeing limit moves overnight is positive for all markets.
Corn Futures (May)
Corn futures staged nice recovery early yesterday but failed to hold all the gains into the close. This morning, prices are working back towards the top end of yesterday’s range. Our pivot pocket remains intact, we have had that defined as 350-355, consecutive closes above there could trigger short covering back to previous support and the breakdown point from Monday, 363 ½-365 ¾. Our bias remains Neutral with concerns of ethanol plants coming to a screeching halt. We may be looking to sell this rally if it appears to be stalling out.
Soybeans caught a bid on spillover momentum from the meal market. As mentioned in our past few reports, we think soybeans have the most upside potential (Over corn and wheat). The market is pressing up against first resistance at 854-854 ¾. This pocket represents previous support and the breakdown point from March 13th. Consecutive closes above here could spark a run into the 880’s. Expect the volatility to continue, especially on the Sunday night open.
Previous Session Bias: Neutral/Bullish
Resistance: 875**, 888 ½-889 ¾***
Pivot: 854-854 ¾
Support: 842-845 ¼***, 820-821**
Chicago Wheat (May)
Chicago wheat futures continued to skyrocket higher yesterday on optimism around increased demand and possible purchases from China. The market blew through our first resistance pocket which took us straight to our next one at 540 ½-542 ½. We like selling this on the first test but wouldn’t be overly aggressive into the weekend.