AM Comments 02/18/16
Thursday, February 18, 2016, 7:02 AM
Submitted by: Dustin Weiner
After a fun start to the week, the outside markets settled down last night and our corn and soybean futures are slightly lower in what looked like a quiet trade. Much of the strength in corn the last couple days has been led by technical buying as outside influences pushed us above key points on the charts. For example, when March corn traded above the 50-day moving average yesterday it was quickly viewed as supportive to the technical traders and triggered additional buying. As for the strength in soybeans it is probably easiest to tie that to the strength in soyoil which closed at its highest level since early December.
Now, after saying all of that – it is important to keep tabs on the fundamental (supply & demand) side of the story. Simply put, there isn’t much there that is bullish. The South American crop remains large (and in the case of Argentina seem to be getting larger), exports remain slow (thanks in part to the $US), domestic end user margins are tight and the US farmer is simply flat long a large amount of the crop. All of that is bearish, but all of that can be deemed “old news”. The market seems to be waiting for something new and exciting to show up but until we get closer to planting season news like that will be tough to find. Maybe yesterday’s action is as exciting as it gets for now: “we closed above an imaginary line on a chart!!”
Corn mixed to a penny lower
Soybeans 2 to 4 cents lower
Have a great day!