April 2, 2015 Written By Chris Robinson Corn: May corn settled up 5 cents at $3.87 ¼. New Crop December corn settled up 4 ¼ cents at $4.11. For the week May corn lost 4 cents, while December lost 3 cents. Corn returned to the middle of its 3-month, 25 cent trading range today. Tuesday punished the bulls and rewarded the bear. 48 hours later, the tables are turned. This truly looks like a market searching for direction. For now, that direction will be directly tied to the weather. Dryness in the plains threatening the wheat crop spilled over into the corn today. For all the huffing and puffing about the USDA info being “right” or “wrong”, this market remains range- bound until Mother Nature has her say. May corn still has a wall of resistance at $4.00 and support at $3.75. CZ is hemmed in with $4.20 resistance above and $3.96 support below. For the week, we had a 25 cent trading range. Hedgers: No change in recommendations. Wheat: May wheat settled up 16 cents at $5.43 which is the highest settlement in 3-months. In the last 48 hours WK rallied 40 cents a bushel from Wednesday’s low at $5.06. For the week, WK gained 28 ½ cents. This rally is completely due to weather worries about lack of rainfall in the plains and reports of rust in some areas. Throw in the large short-bet the managed funds have in place and it looked like a stop- hunting day in a pre- holiday market chop-fest. For the week, WK had a 38 cent trading range. Monday at 3PM CST we will get our first crop condition report. A negative report could be the Molotov cocktail the bulls have been waiting for to set off fireworks to the upside. Will drought and winterkill be the foundation for a substantive rally? While this bounce higher is sharp, you have to take it in perspective. We have returned to the top of a 45 cent wide trading range we’ve been mired in for the entire first quarter of 2015. The upper wall of resistance in WK is $5.45 while the support below comes at $5.00. A continued rally would run into at $5.54 and then $5.77. $5.77 would take us ½ way back of the $1.99 break from the December 18th 10-month high and the March 9th contract low at $4.78 ¼. Hedgers: No change in recommendations. Soybeans: May soybeans settled down 3 ¾ cents at $9.86. New crop November (SX) gained 1 ½ cents to settle at 9.74 ¼ . For the week, May beans gained 18 ¾ cents, while SX picked up 25 ½ cents. A volatile end to a volatile week in SK as Tuesday gave us a fresh 6-month low price tick down at $9.51 ¼. 72 hours later we traded up 41 ¾ cents higher to today’s 1-month high today at $9.93 ¾ . The herd was bearish beans going into the report. If they didn’t cover their shorts early after the report, most likely, they had a margin clerk force them to cover it today. Such is the nature of speculation. The arguments continue in the trade about the “accuracy ” of the USDA’s estimates. The overall report was rather neutral. We still have a 385 million bushel carryout. Exports continue to be less than hair-raising. The meal exports are the lone strong spot in the export reports. Hedgers: No change in recommendations. Tomorrow the grains and livestock markets are closed in observance of Good Friday. The US Department of Labor, will release the March Unemployment figures at 7:30AM CST. The bond market, currencies and equity markets will be open for a half day. Sunday night’s electronic trade might have spillover from any real shocker from that number. As we tip into the planting and growing season, Mother Nature holds all the cards. When markets are as volatile as this, the long option strategy we use really shines from a risk management stand point. We have your downside covered. However, you are completly able to participate in any rally the market’s may provide us the rest of the year. For your unpriced grain, the sky’s the limit should the weather bulls grab a hold of these grain markets and start running. From all of us here at Top Third Ag Marketing have a safe and Happy Easter Weekend. CER
