Morning Futures Roundup
Brisk Planting Pace Shakes Out Corn Bulls
Corn futures have been sliding in recent sessions on long liquidation and early crop progress. Farmers have taken advantage of the unseasonably warm spring, planting 17% of the crop, versus the 10-year average of 7%. There was some hope from the bull camp that the recent wet weather would interfere with or slow down plantings, but the forecast calls for warm weather without excessive moisture in the near-term, presenting ideal planting conditions.
There are rumblings indicating that some farmers may be switching to Bean acres instead of Corn to take advantage of attractive pricing. Many traders may be a bit skeptical of such rumors, as they tend to be plentiful this time of year and are oftentimes unsubstantiated. Some traders may instead want to look to planting data for concrete evidence of a crop switch. Corn prices are flirting with the $6 level, which may be attractive to physical buyers, especially China, who has been surprisingly quiet in the import market. Likewise, speculators may be considered potential value buyers at current levels.
Turning to the chart, we see the July Corn contract trading near support around the 600 level. This area of the chart offers several areas of support, most notably at the 575 level, which can be seen as a make-or-break level. If Corn mounts several closes below 575, it would signal a significant bearish breakout. Support near 600 and 575 may attract value buyers. Currently, the oscillators are giving neutral and flat readings which do not offer any insight to the potential near-term direction of the market.
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