Daily Grains Analysis for March 6, 2018

Grains prices are mixed in early trade on Monday, as dry weather in Argentina is offset by profit taking.  The USDA’s January soybean crush data showed some variance from the data NOPA had previously reported.  Per the USDA, 174,516,800 bushels of beans were crushed during the month of January. This resulted in 1.998 billion pounds of oil and 3.867 million tons of meal. The crush slipped by 1.03% from December. Oil production declined by 0.87% and meal output was 0.96% lower. Month ending stocks for soybean meal dropped 30% to 356,194 tons, partially reversing last month’s 40% climb. Crude oil stocks added to last month’s 15% rise by adding an additional 18% to 1.866 billion pounds.

Corn Prices

Corn prices opened lower and are consolidating and forming a bull flag continuation pattern which is a pause that refreshes higher. Support on corn is seen near the 10-day moving average at 370.7. Resistance is seen near the March highs at 380. Momentum has turned positive as the MACD histogram is printing in the black with an upward sloping trajectory which points to higher prices. The RSI has turned lower and is no longer in overbought territory.

Soybean Prices

Soybean prices moved lower as traders exited long positions. Support on soybeans is seen near the breakout level at 1048, and then the 10-day moving average at 1042. Resistance is seen near the January 2017 highs at 1080. Positive momentum is decelerating as the RSI turned lower reflecting decelerating positive momentum. The current reading of 75, is above the overbought trigger level of 70 and could foreshadow a correction.

Wheat Prices

Wheat futures are consolidating at elevated levels. Prices are forming a bull flag pattern which is a pause that refreshes higher. Short-term support is seen near the 10-day moving average 4.696. Resistance is seen near the July highs at 5.94. Momentum has turned positive as the MACD (moving average convergence divergence) index generated a crossover buy signal. The MACD histogram is printing in the black with an upward sloping trajectory which points to higher prices.