Daily Grains Analysis for March 21, 2018 – Corn and Soy Bounce but Trend Points to Lower Prices

Grain prices are mixed in Wednesday, after a mixed session on Tuesday that saw corn prices moved lower, but soybean rebound. With China eyeing a tariff on soybeans which could weigh on prices, grains have been punished, moving below support levels. Managed money is offsides in all three major grain categories, leaving the market vulnerable for a further slide in prices.

Corn Prices

Corn prices are consolidating after breaking down on Monday through support near and upward sloping trend line that comes in near 3.765 which is now seen as resistance. Additional resistance is seen near the 10-day moving average at 381.  The first level of support is seen near the 50-day moving average at 366. Momentum has turned negative as the MACD (moving average convergence divergence) index recently generated a crossover sell signal.  The MACD histogram is printing in the red with a down sloping trajectory which points to lower prices.

Soybean Prices

Soybean rebounded but the gains came despite fresh rainfall in portions of Argentina as technically driven trading continued to drive prices. In addition to technical buying, soybean prices were also supported by gains in soybean meal futures, which rose a. Soybean meal prices were supported by meal/oil spreading triggered by weakness in soybean oil futures. Meal/oil spreading also pressured oil share, which fell. The gains in soybean futures pressured nearby crush margins, which were mixed with nearby contracts down about two percent while deferred contracts past the October contract were marginally higher.

Soybean prices rebounded after breaking down through trend line support on Monday and are consolidating in early trade on Wednesday. Resistance is seen near the breakdown level at 1035 and then the 10-day moving average at 1036. Support is seen near the 50-day moving average which is seen as target support near 1009.  Negative momentum has accelerated as the MACD (moving average convergence divergence) index prints in the red with a declining trajectory which points to lower prices.

Wheat Prices

Wheat prices broke down trough trend line support which was former support now resistance again at 454.  Support is seen near the February lows at 440. Momentum has turned negative as the MACD (moving average convergence divergence) index recently generated a crossover sell signal.  The MACD histogram is printing in the red with a down sloping trajectory which points to lower prices.