February 28, 2008

 

CBOT Corn Outlook on Thursday: Flat-Down 1 cents; consolidates, lacks news

 

 

Corn futures on the Chicago Board of Trade are expected to start Thursday's day session steady to lower, as the market continues its consolidative phase in the absence of fresh news.

 

Analysts expect corn to open flat to 1 cent lower.

 

In overnight electronic trading, March corn was 3/4 cent lower at US$5.24 1/4, May corn was unchanged at US$5.38, July corn was 1/2 cent lower at US$5.49 1/2, and December corn was 3 cents lower at US$5.50 1/2.

 

A quiet news front, with routine export demand and lack of fresh directive influences is seen keeping futures in a sideways trend, consolidating after setting new all-time highs earlier in the week, analysts said.

 

There is just an overall lack of news for the market, with ample nearby inventories and a more definitive view on new crop acreage not expected to emerge until the market gets deep in March promoting a consolidation theme, analysts added.

 

Meanwhile, spillover weakness from wheat and end of the month position squaring is seen applying mild pressure, while prospects for a tightening balance sheet limits downside moves, a trader added.

 

Technically motivated activity will remain a feature short term, as traders take cautious approach until new fundamental news surfaces, he added.

 

A technical analyst said a minor bearish descending triangle pattern has formed on the daily July corn bar chart. The next upside price objective is to push and close prices above solid resistance at the contract high of US$5.66 3/4. The next downside price objective is to push and close prices below solid support at this week's low of US$5.42.

 

First resistance for July corn is seen at Wednesday's high of US$5.54 1/2 and then at US$5.58 3/4. First support is seen at Wednesday's low of US$5.44 and then at US$5.42.

 

U.S. Department of Agriculture reported total weekly soybean export sales were 776,100 metric tonnes for the week ended Feb. 21. 2007-08 marketing year sales of 601,300 tonnes were a marketing year low. The sales were primarily for Japan with 256,100 metric tonnes, and Syria with 100,600 tonnes. Analysts had forecast sales between 600,000 and 950,000 metric tonnes.

 

The DTN Meteorlogix Weather Service said scattered to widely scattered thundershowers during the past 24 hours will help maintain soil moisture for filling crops in Argentina.