AgriVisor Morning MarketWatch

Monday, September 19, 2016
***** Corn up a penny; soybeans higher by 10 cents ahead of the break; Chicago wheat gains 1 3/4 to 3 1/4 cents. *****

   # Grains start the new week with some momentum to the upside.  Soybean futures lead the way with help from technical buying.
   # Farmers in the Midwest will enjoy a couple of dry days before rain returns late in the next 6-10 days.  The two-week maps are cool west, warmer east while leaning wet throughout the Corn Belt.  
   # China returns from holiday and will be expected to show up on USDA’s daily export sales reporting system.  Cumulative U.S. soybean sales run nearly 40 percent higher than the year-ago total with help from the world’s top bean buyer.
   # The weekly CFTC report showed the “managed money” category of traders covering corn shorts but still net-short the grain by 147,000 contracts.  The large speculators added both some longs and some shorts to end up net-long soybeans by 79,000.  They covered a small portion of short wheat positions held to bring the bearish bet on Chicago futures down to 125,000 contracts.
   # Egypt is seen scrapping its zero-tolerance ergot fungus policy sometime in the next few weeks after the country’s latest wheat tender was met with no offers.  
   # December corn futures are working on technical resistance from their 50-day moving average while on their way toward August and September highs of $3.44 1/4 and $3.43 1/4.  November soybeans trade above their 200-day moving average while approaching a potential resistance point at $9.90.
   # Outside markets are calmer at the start of the week and help restore some stability in the commodity space.  The Federal Reserve Open Market Committee meets on Tuesday and Wednesday to discuss U.S. interest rates, so this recent period of heightened financial market volatility may not be over just yet.    

***** Cattle futures look to build on newfound technical momentum; hogs still due for a technical correction. *****

   # The cattle market enjoys some support from cash prices that improved last week.  Also supportive is some corrective technical momentum that is helping to carve out a V-bottom on the charts.
   # Hog futures remain on the defensive as traders take direction from a weak pair of cash and wholesale markets.  Slaughters and weights still run high and keep the production fundamentals bearish, but last week’s push to new contract lows may have priced that supply negativity into the market.