10/27/17

Morning Bullet Points - 10/27/2017

GOOD MORNING—

 

MARKET HIGHLIGHTS

  • Markets trading mixed overnight in another quiet trade going into today’s November option expiration. 
  • Out of the gates, corn is down 1.5 cents, soybeans down 1 cent and wheat down 2.5 cents.
  • Greatest corn option open interest is at $3.40 puts and $3.50 calls.  Greatest soybean OI is still at $9.60 on the puts, and call OI is now greatest also at $9.60 but doubt we pin that strike today.
  • No major changes to the weather.
  • Corn technically continues to struggle to move from $3.50 with support at $3.495 and resistance $3.52 ½
  • Soybeans have corrected off their highs, but are still in their up-trend.  Support at 9.70 and resistance at 9.80.
  • Wheat remains range-bound with support at 4.30 and resistance 4.40.
  • USDA reported 238,000 MT of soybeans to China for 2017/18.
  • USDA reported 132,000 MT of corn to Spain for 2017/18.

 

WEATHER      

  • Brazil rains expected to hit dry areas over the next couple of weeks.
  • Argentina is wetter late next week, which will keep planting somewhat slow.
  • US weather is pretty dry until the 11-15 period to allow harvest to resume.
  • Overall, no major changes to affect the market.

 

OUTLOOK

  • Corn continues to drift sideways with no catalyst to push it out of this range.  Look for that to continue until we get past the 50% mark on harvest.  I still think there is potential for December futures to trade up to 3.70 before expiration.
  • Soybeans are correcting, but the trend is higher.  Yields are starting to disappoint as harvest winds down.  With producers heavily sold, I think beans could have a good market this year with any production hiccups in South America.
  • Wheat is the same as corn.  Range-bound.

 

Fun Fact of the Day:  The concentration of salt in seawater (salinity) is about 35 parts per thousand.  Stated in another way, about 3.5 percent of the weight of seawater comes from the dissolved salts; in a cubic mile of seawater, the weight of the salt (in the form of sodium chloride) would be about 120 million tons.

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