Grain Express 1/3/23
Posted: Jan. 3, 2023, 8:59 a.m.
Brazilian Exports
Brazil exported 2.02 MMT of soybeans in December, down from 2.64 in the previous month. Corn exports for the month came in at 6.441 MMT, up from 6.06 in the previous month and well above the 3.41 for the same month last year.
South America Weather
Argentina received some beneficial rains which might slow the pace of the declining crop ratings for corn and soybeans, but forecasts for the next 10 days remain hot and dry.
Weather in Brazil continues to be favorable for the crops progression.
Crush
The USDA will release crush data this afternoon, 2pm CT. Analysts are expecting to see total soybean crush at 190 million bushels, down 3.5%. Corn for ethanol use is expected to be at 448.7 million bushels.
Outside Markets
Equity markets are firm in the early morning trade. Crude oil has traded on both sides of unchanged, trading as high as 81.50 and as low as 78.78 for the February contract, currently trading at 79.79. The US Dollar is up 1.14% to 104.45.
Corn (March)
Managed Money Position: 163,666 (Chart and Changes Below; Updated with the Weekly CoT Report)
Seasonal Trend in Play: March corn futures have trended higher from November 16th to January 4th for 13 of the last 15 years.
Below is a daily chart of March corn futures
Technicals: Corn futures will re-open this morning at 8:30 AM CT. Resistance at 685 was tested and held on Friday. If the Bulls can chew through and close above that level, we could see an extension towards the technically and psychologically significant $7.00 handle. With that said, we still like leaning on the Bearish side at these levels, especially for producers who may need to hedge. the CME CVOL corn index is at 19.61, off the lows of 16.82 from December 16th, but still historically low, meaning that options are relatively inexpensive. We saw the Corn CVOL index as high as 50.20 in July of 2022.
Bias: Bearish/Neutral
Previous Session Bias: Bearish/Neutral
Resistance: 685**, 700-704 3/4
Pivot: 674-676
Support: 656-660***, 647 1/4-652 3/4***
Soybeans (March)
Managed Money Position: 128,616 (Chart and Changes Below;Updated with the weekly CoT Report)
Seasonal Trend in Play: March soybeans have trended higher from November 16th to January 9th for 14 of the last 15 years.
Technicals: Soybeans made new highs for the move on Friday, trading to their highest price since June 22nd, filling the gap from June 23rd. The market had an impressive December, taking the RSI up to 65.56, not what is typically considered "overbought" but it is at the upper end of the range dating back to last summer. If the Bulls can achieve consecutive closes above the pivot, 1524-1528 1/2, we could see an extension towards the June high, 1572 1/4. We are moving our bias into bearish territory to start the new year and as with corn, we think that this is an opportunity for producers to lay off some risk. CME CVOL index for soybeans is at 20.01, off the lows of 17.04 but still historically low. We saw it as high a s37.46 in July.
Bias: Bearish/Neutral
Previous Session Bias: Neutral
Resistance: 1545 3/4-1550**, 1572 1/4***
Pivot: 1524-1528 1/2
Support: 1493 1/2-1500***, 1475 3/4-1484 ***, 1460-1465**
Wheat (March)
Managed Money Position: -59,311 (Chart and Changes Below; Updated with the Weekly CoT Report)
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Seasonal Trend in Play: None. Next Seasonal Trend: March KC Wheat, Starts on January 10th. |
Technicals: March wheat futures finished the year on a high note, rallying on Friday. However, it wasn't enough to trigger a true breakout, keeping resistance levels intact to start the year. Our bias remains neutral as we believe we could continue to see some great opportunities for participants on both sides of the market.
Bias: Neutral
Previous Session Bias: Neutral
Resistance: 790-800**, 816 1/2-819 1/4**
Pivot: 760-765
Support: 690-700***
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