Grain Market Commentary for January 24, 2018

Grain Farmers of Ontario farmer-members are invited to attend two full-day marketing seminars on grain marketing: Intro to Futures & Options, as well as the more advanced Options & Technical Analysis.

Commodity Period Price Weekly Movement
Corn CBOT March 3.56 ↑ 03 cents
Soybeans CBOT March 9.92 ↑ 23 cents
Wheat CBOT March 4.33 ↑ 13 cents
Wheat Minn. March 6.08 ↓ 04 cents
Wheat Kansas March 4.33 ↑ 05 cents
Chicago Oats March 2.75 ↑ 21 cents
Canadian $ March 0.8115 ↑ 1.50 points

Corn

As we suggested last week, we are now pushing the envelope at the $3.55 level on the March contract. We closed the day at $3.56 but not quite enough to call it a break above support. Let’s see what tomorrow brings, but for now the charts are looking promising and as we mentioned last week we should be on our way to test the $3.60 level in the coming week. Support is still seen at the $3.40 level on the March contract, while overhead resistance is seen at $3.60.

Short term indicators are still negative, with the continuation chart looking more constructive for a spring rally.

The primary trend is still down.

Soybeans

The soybean chart has given us two red buy signals, one on the weekly chart back before Christmas and this week we received one on the daily chart. Pressure is mounting for yet another challenge to the $10.25 level in February. The weekly chart shows a clear break of the down-trend line, although the momentum hasn’t transformed into a rally as of yet. Support is seen on the March charts at the $9.50 level while our overhead resistance level is still at the $10.25 level.

A close about the $10.50 top would catapult this contract at least a dollar higher in a short time frame.

Short term indicators are still neutral but the primary trend is still down.

Wheat

The wheat had a good move on January 24 as the March contract moved higher by 11 ½ cents to close at $4.33 cents. Our resistance has been pegged at the $4.35 level and like the corn we are basically in that area. It will be interesting to see if we continue upward through the resistance levels on both contracts or if we pull back again before making a run at the resistance levels on both contracts. Last week we stuck our nose in the gap at $4.21 by just a penny, but that is enough technically to take out any stops.

Good support is seen around the $4 – $4.10 mark on the March futures chart. Overhead resistance is still viewed at $4.35 and again at $4.45. The wheat contract at this point is more of the follower than the leader but it is looking like the support is holding quite nicely.

Indicators are showing oversold conditions. Short term indicators are bullish, but the primary trend is still down.

Cash Grain prices as of the close, January 24, are as follows: SWW @ $193.79MT ($5.27/bu), HRW @ $191.53/MT ($5.21/bu), HRS @ $227.76/MT ($6.20bu), SRW @ $189.27/MT ($5.15/bu).

Marty Hibbs is a grain merchandiser with Grain Farmers of Ontario. Hibbs is a 25 year veteran futures trader, analyst, and portfolio manager. He was a regular guest analyst on BNN for four years and is currently authoring the Market Side education series on futures trading basics in the Ontario Grain Farmer magazine.