You are here
Trade Eyes Next Week’s WASDE Report
Very calm trade was seen today both from a lack of news and possibly from other activities occurring in Chicago today. Average estimates for yield and carryout were posted this morning with analysts suggesting a 173.2 yield and 2.300 carryout. That hints at a slightly bullish report with last month’s carryout coming in at 2.320. With that new carryout estimate, the December has moved slightly away from a middle-of-the-road price of 342 and has turned slightly bullish closing at 348¾.
This close is fitting with the analysts’ estimate numbers seen today. With some traders cautious due to the upcoming election while others are cautious due to the USDA report next week, there is plenty of reason to see corn trade sideways for the short-term. Long-term is still based on demand remaining strong. While ethanol has little reason to slow due to any upcoming issues, there are at least some thoughts that an election where Trump wins could mean a slowdown of Mexican purchases of U.S. corn. That is likely far more fear and true reason to be concerned, but is still something to watch longer term.
- Analysts’ estimate for carryout came out today at 2.300 compared with 2.320 last month.
- Bulls will still be looking for an increase in both ethanol and export demand, which could cause an even lower carryout than seen above.
- Any level under 342 in December might be seen as a buy for bulls looking for a bullish report next week.
- Bears will be looking for a larger yield increase on next week’s report, which would be seen as disappointing from this current price level.
- Even a neutral report could cause a setback to the uptrend support line, which is still down close to 337½.
Rich Nelson / Allendale Inc. / 815-578-6161
This material has been prepared by a sales or trading employee or agent of Allendale Inc. and is, or is in the nature of, a solicitation. This material is not a research report prepared by Allendale Inc.’s Research Department. By accepting this communication, you agree that you are an experienced user of the futures markets, capable of making independent trading decisions, and agree that you are not, and will not, rely solely on this communication in making trading decisions. DISTRIBUTION IN SOME JURISDICTIONS MAY BE PROHIBITED OR RESTRICTED BY LAW. PERSONS IN POSSESSION OF THIS COMMUNICATION INDIRECTLY SHOULD INFORM THEMSELVES ABOUT AND OBSERVE ANY SUCH PROHIBITION OR RESTRICTIONS. TO THE EXTENT THAT YOU HAVE RECEIVED THIS COMMUNICATION INDIRECTLY AND SOLICITATIONS ARE PROHIBITED IN YOUR JURISDICTION WITHOUT REGISTRATION, THE MARKET COMMENTARY IN THIS COMMUNICATION SHOULD NOT BE CONSIDERED A SOLICITATION. The risk of loss in trading futures and/or options is substantial and each investor and/or trader must consider whether this is a suitable investment. Past performance, whether actual or indicated by simulated historical tests of strategies, is not indicative of future results. Trading advice is based on information taken from trades and statistical services and other sources that Allendale Inc. believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades.