Daily Grains Analysis for March 9, 2018

Grain prices were under pressure early on Thursday in North American trade. Trade concerns are on the minds of trader’s as the White House announced that it would postpone revealing its Tariffs until later in the week. China’s appetite for U.S. soybeans has waned, and concerns abound bean exports could suffer further if President Donald Trump makes good on a promise to impose tariffs on imports of steel and aluminum. Traders are concerned that China might retaliate by slowing imports of U.S. beans or by erecting trade barriers to them.

Corn Prices

Corn prices were lower but are still forming a bull flat pattern which is a pause that refreshes higher.  Support is seen near the 10-day moving average at 3.75 per bushel. The first level of target resistance is seen near the July highs at 3.94 per bushel. Positive momentum has stalled and is decelerating as the MACD (moving average convergence divergence) histogram prints in the black with a declining trajectory which points to higher prices.  The RSI continues to move sideways but the current reading of 72, is above the overbought trigger level and could foreshadow a correction.

Soybean Prices

Chinese officials in February said they would investigate whether the U.S. subsidizes sorghum exports to the country after the Trump administration slapped tariffs on goods like solar panels that are manufactured by Chinese companies. The American Soybean Association, said Chinese officials in Washington, D.C., told its leaders that soybeans also could face scrutiny.

Soybeans are trading on the defensive. Support on soybeans is seen near the 10-day moving average at 1050. Resistance is seen near the March highs at 1071. Momentum has turned negative as the MACD (moving average convergence divergence) index generated a crossover sell signal. The RSI (relative strength index) is moving lower and printing a reading of 65, moving out of the overbought zone, and into the neutral level which is generally considered a sell signal.

Wheat Prices

Wheat prices rebounded in electronic trade after closing at session lows on Wednesday. Short-term support is seen near the 10-day moving average 4.85. Wednesday’s outside day which had a higher high a lower low and a lower close is considered a reversal pattern. Resistance is seen near the July highs at 5.53. Momentum is turning neutral as the MACD (moving average convergence divergence) histogram prints in the black with a downward sloping trajectory which points to consolidate. The RSI (relative strength index) is moving sideways which reflects consolidation as it prints a reading of 64.5 at the upper end of the neutral range.