February 12, 2008

 

CBOT Corn Outlook on Tuesday: Called 1-2 cents lower; lacks fresh inputs

 

 

Chicago Board of Trade corn futures are expected to begin day time trading 1 to 2 cents lower, following the tone established in overnight trade with little fresh fundamental news to influence market direction, analysts said.

 

In overnight electronic trading, March corn slipped 2 cents to US$5.01 1/2 per bushel and December fell 1 1/4 cents to US$5.24. Electronic trading volume in March was 8,917 contracts.

 

There isn't much fresh news out to influence corn, and as a result, it will follow the other grains and outside markets, an analyst said. Crude oil is lower, but soybeans are higher and wheat is mixed, so corn could trade in a choppy, two-sided pattern, the analyst said.

 

Ahead of the opening, crude oil was trading around a US$1.00 per barrel lower.

 

Although fundamental news is lacking, corn could have a hard time breaking, a commission house analyst said. Nearby Minneapolis wheat ended limit-up overnight, making another new all-time high, and soybean futures were higher in overnight trade. Deferred wheat months, however, were lower, the analyst said.

 

In Argentina, mainly dry weather is forecast through Thursday with temperatures near-to-below normal Wednesday and near-to-above normal Thursday, DTN Meteorlogix Weather said. The lack of heat and recent rains is providing generally favorable conditions for the country's corn crop, Meteorlogix Weather said.

 

On daily technical charts, July corn closed lower, but nearer the session high. Corn bulls were impressed by the market's ability to hold off strong selling pressure in the face of steep losses in nearby CBOT and KCBT wheat futures, a market technician said.

 

However, recent technical action in corn has not been bullish. The bulls' next upside price objective is to push and close prices above solid resistance at US$5.42 per bushel. The next downside objective is to close prices below solid support at last week's low of US$5.14 1/4.

 

First resistance for July corn is seen at US$5.30 and then at US$5.35. First support is seen at US$5.20 and then at Monday's low of US$5.16.

 

In other corn news, Israel purchased 55,000 metric tonnes of U.S. corn overnight, analysts said. China's Dalian Commodities Exchange remains closed due to the Lunar New Year holiday.