Yahoo Finance Daily Grains Analysis – Corn Breaks Higher Ahead of WASDE Report
The February WASDE report is scheduled to be released this Thursday. Analysts’ projections for 2017/18 US soybean ending stocks range from 460 million bushels to 535 million with an average of 486 million. If the average is realized, it would represent a 16-million-bushel increase from USDA’s January projection of 470 million bushels. The anticipated increase in US ending stocks is likely being driven by a reduction in USDA’s projection of 2017/18 US soybean exports. USDA’s January projection of 2.16 billion bushels was reduced 65 million bushels from its December forecast, but slower-than-expected exports over the last month could push an additional reduction in its export forecast.
Corn Prices
Corn prices whipsawed on Tuesday generating an outside reversal day, hitting a lower low and then a higher high and a higher close. Prices continue to breakout on Wednesday as risk aversion abates. Support is seen near the 10-day moving average at 3.60 per bushel. The first level of target resistance is seen near the August highs at 3.75 per bushel. Momentum is accelerating higher as the MACD (moving average convergence divergence) histogram prints in the black with an upward sloping trajectory which points to higher prices.
Soybean Prices
Soybean prices rebounded on Tuesday and continued to attempt to move higher early on Wednesday. Analysts’ projections of USDA’s forecast of Brazilian soybean production range from 110 million to 112.5 million tons with an average of 111.2 million. The average, if realized, would represent a 1.2-million-tonne increase from USDA’s January forecast of 110 million and is 300,000 tons below expectations.
Support on soybeans is seen near the February lows at 967. Resistance is seen near the downward sloping trend line at 1008. Momentum is neutral as the MACD (moving average convergence divergence) histogram prints near the zero-index level with a flat trajectory which points to consolidation. The RSI (relative strength index) is moving sideways which reflects consolidation as it prints a reading of 55 which is in the middle of the neutral range.
Wheat Prices
Wheat prices moved higher bounced from session lows on Tuesday. Short-term support is seen near the 10-day moving average 4.47. Support on wheat futures prices is seen near an upward sloping trend line that connects the lows in December to the lows in January and comes in near 4.35 per bushel. Resistance is seen near a downward sloping trend line that comes in near 4.59. Momentum is neutral as the MACD (moving average convergence divergence) histogram prints near the zero-index level with a flat trajectory which points to consolidation. The RSI (relative strength index) is moving sideways which reflects consolidation as it prints a reading of 62 which is in the middle of the neutral range.
This article was originally posted on FX Empire
