Corn Report, 10/17/2016

Monday, October 17, 2016

With fund buying support, corn was able to bust through and solidly trade higher the $3.50 support level, reaching a high of $3.5875 before settling for the week at $3.5425 with funds buying an estimated 13K contracts. With the strength from the end of last week, we are flirting with the 100MA and if we a get a third day of fund strength, and everything comes in 3’s as every trader knows, we could see pressure enough to break through that trend line and up to $3.60. Good producer selling on Friday, especially out of western Kansas, has kept country basis firm to lower as commercial ownership and the run up in the board has given way to basis weakness. USD remains higher, bouncing between 98-97.50 the past few days after rally. Harvest reports should continue to hit the market all week, which one would think would keep a downside pressure on this complex, but with the funds at an estimated 105K short, there still is plenty of gas to feed a run, but will we see producer selling to combat any fund rally? If we see producer selling I would expect it to come from the western corn belt first, and I expect another round at $3.60. Looking for some strength today, I would not be surprised to see us pressure $3.58-$3.60 at some point today, but looking to see a weaker close. CZ has support at $3.49 then $3.37 with resistance at $3.5750 then $3.64.

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