Weekly commentary is written by Marty Hibbs, Grain Farmers of Ontario.
All of these reports include a weekly Ontario Wheat Market Commentary for the current season. Ontario Corn and Soybean Commentaries are also included; reflecting the overall Grain Farmers of Ontario perspective.
October 19, 2016
|| 20 cents
|| 35 cents
|| 23 cents
|| 08 cents
|| 27 cents
|| 11 cents
|| 0.60 points
Corn had another good week on the charts as the October 12 report was the lowest price we saw all week. The saucer bottom being formed here suggests another leg up towards the $3.70-$3.80 level based on December. One would hope that the funds start throwing in the towel and covering their short positions, which would cause a decent rally in the coming weeks. Our Labour Day low is still looking more like the bottom, and for those of you looking for a selling point to price some of your 2016 harvest, the $3.70-$3.80 would be a good place to start.
Short term support is seen at $3.50 on the December contract, while overhead resistance is seen at the $3.60 - $3.80 level on the lead month. Our red buy signal from September 12 is still intact, but we have yet to receive one on the weekly chart. The short term indicators are still positive, but the main trend is still down.
The beans rallied 50 cents after the October 12 report towards the $10 overhead barrier. There are within reach of this resistance, but the indicators are not bullish. With harvest in full swing and wet conditions causing some issues, we could see the $10 challenged as early as next week. At that level, we expect serious resistance that coincides with resistance levels on the other grains. Meanwhile, support is seen at the $9.25 level, and overhead resistance is still at the $9.80 - $10 mark on the November contract.
The main trend is still down.
The wheat support at the $3.96 level from last week held quite nicely, and we reversed course the day after the October 12 report. Our overhead resistance of $4.25 mentioned last week was tested within the next couple of trading sessions and we are now pulling back slightly before a possible assault on the $4.40 level on December. If we manage to close above $4.25, I feel we will have a good run towards the $4.40 level. If we reach the $4.40 area before the next commentary, we could see and pullback from there. For those of you who are looking at a place to sell some wheat, I believe that the $4.40 level on Chicago is a good place to start. The Chicago wheat seems to still be the weakest of the big three, at least for the time being. However, the spring wheat contract looks much stronger, and it now has a buy signal on the weekly chart. Corn and wheat are looking much more constructive on the charts, but the main trend in both is still down.
Harvest 2016 crop cash prices as of close on October 19, 2016
SWW @ $175.96MT ($4.79/bu), HRW @ $173.55/MT ($4.72/bu),
HRS @ $207.77/MT ($5.65/bu), SRW @ $175.96/MT ($4.79/bu).