The grain complex started the week just like any other Monday, steady with average volume. One thing no grain trader expected was a downgrade on Greece debt rating by Moody’s to junk status. Although a downgrade across the Atlantic shouldn’t affect the price of a bushel of corn or wheat, traders got the jitters and sold early in the afternoon. Corn futures started the session on a strong note with a slight gap up open. Traders sold corn to fill in the gap and once it was completed, prices started to rise. When the Greece news hit the wires, corn broke lower but couldn’t hold since there was no fundamental impact. Corn recovered the slight loss, rallied into the close on high volume, made new intraday highs and settled on the higher end of the range. Soybeans had a lot of action as they swung up and down the entire session. Off the opening bell, prices were strong but drifted down attempting to make new lows. When prices couldn’t stay in the negative, buyers stepped in and rallied the market to new daily and weekly highs. When news from Moody’s was announced, soybean prices retreated and started to collapse in a volatile fashion. Prices slightly recovered but there were no takers so prices continued to weaken into the closing bell. Soybeans managed to settle slightly above technical price 950.00. Wheat was the strongest grain in the complex as they rallied from the start. Anytime there was a technical dip, buyers stepped in and pushed prices higher. Wheat prices drifted in a sideways direction mid-morning and into the afternoon. When the downgrade news was declared, prices started to fall with increased volume. Wheat prices attempted to recover before the close, but longs ran for the door and sold everything causing wheat prices to fluctuate in an 8 point range. Wheat did hold some ground and closed on the higher end of its range.

From the prior day’s choppy close, the grain complex was poised to open on the higher side. Corn futures started the session positive as they marched to make new daily highs. Once the prior day’s resistance price was broken, prices drifted sideways for a few minutes before experiencing a major break. Even though prices declined, they managed to stay above previous day’s support price of 350.00. Buyers saw the technical support and started to lift the offers pushing prices to new highs. Corn ended the day at the higher levels of its range. After the massive sell off soybeans experienced during the closing period on Monday, prices opened surprisingly higher ignoring what happened 20 hours ago. Soybeans started the session by making new daily highs and once those prices were breached, soybeans drifted in a sideways direction info the afternoon. With soybeans going nowhere, it seemed optimal for longs to liquidate as prices attempted to make new intraday lows. Soybeans bounced off the sessions lows only to be pushed back down during the closing period. Soybean prices collapsed during the closing period by nearly 5 points down to 947.25. Wheat futures were choppy during the opening period. Initially wheat broke above prior day’s resistance only to be taken all away when they bounced off prior day’s low of 446.50. Unable to go any lower, prices slowly inched up to make another intraday high. When soybeans sold off, wheat followed as it gave away 6 points into the closing period. Wheat futures settled in the middle of their trading range.

The mid-morning rally seen in the corn pits carried over into Wednesday morning as corn opened steady on average volume. After the buyers stepped aside, corn prices drifted sideways until the afternoon. When corn hit and held resistance at 360.00 multiple times, prices started to break lower as longs started to liquidate for short term gains. Prices remained in a tight narrow range coming into the closing bell and managed to close in the middle of the daily range and up for the week. Soybeans followed corn off the opening bell as prices rallied until soybeans hit resistance at 959.50. After a technical retracement on soybean prices, buyers stepped in and pushed prices higher. But after drifting range bound, prices started to creep up breaking resistance and rallied to 961.75. With the mid-day rally, soybeans met daily resistance at 961.75 and prices started to head south with a double top chart formation. After the slight pullback in prices they settled the day on the higher end of their daily range. Wheat joined rest of the grain complex as they too opened strong on high volume. Wheat had an initial spike early on which sparked the rally bringing in technical buyers and pushing prices up to 468.00. Wheat was the biggest gainer in the complex throughout the day. When wheat formed a triple top on a 3 minute bar chart at 468.00, traders viewing the market from a technical stand point sold wheat futures into the closing bell as they lost 10 points from their daily highs. With the choppy activity that day, wheat settled up for the day and above a key fundamental price of 460.00.

The century old axiom “Buy the rumor, Sell the news” was evident in the corn pits Thursday morning. After the speculation on China phased out, longs liquidated their positions during the opening bell as prices retreated lower to 354.50. After the initial sell off at the open, prices recovered slowly on light volume but held key technical resistance at 359.00. When buyers could no longer push prices any higher, corn futures sold off once again coming into the afternoon. With a choppy day session, corn did manage to close up for the day and week. Soybeans had a choppy open on high volume as they swung in wide ranges. When they formed a technical double bottom at 955.25, buyers saw that as an opportunity to buy low and sell high. Prices advanced on average volume and continued to rise into the afternoon with a high of 964.00. Once that high was made and prices couldn’t go any higher, the sellers stepped in and knocked down all the gains for the day as soybeans made a new intraday low in the afternoon. After a break in prices, soybeans drifted in a sideways direction only to get pressured down again into the close as it went even lower to 951.00. With the volatile session, soybeans closed down for the day at the lower levels of their range. The selloff in wheat prices continued at the opening bell with wide swings and heavy volume. Wheat futures lost nearly 12 points during the opening period. Then buyers stepped in and slowly started to push prices higher. Mid-morning there was a surge in volume with a spike pushing prices to 463.75. After the price advance, wheat prices stayed range bound drifting in a 3 point range.

Quadruple witching is a day on which contracts for stock index futures, stock index options, stock options and single stock futures all expire. With these rare activity as it only happens 4 times a year, a lot of volatility is expected in the markets. Corn futures started the end of the week on a strong note. Corn advanced to weekly resistance levels of 360.00 multiple times, and once those offers were lifted, prices rallied on high volume up to 364.50. After the rally phased out and prices couldn’t go any higher, volume dried up and prices chopped around in a 3 point range. Being Friday and traders wanting to book a profit, longs were liquidated into the close when prices broke down to settle the week at 360.75. Corn futures closed up for the week and month. Soybeans had a choppy open as it made an intraday high and low within the first hour of trading. Daily low of 953.75 held and prices advanced to 961.25, 2 ticks shy of their weekly resistance. When technical resistance held strong, prices declined to the middle of their range. During the afternoon session, soybeans started to rise again but met resistance at 961 once again and headed south into the closing period. After a choppy session, soybeans settled up for the week and month. Wheat mirrored soybeans as it too had a choppy open. When lows in wheat were formed, prices rallied on increased volume. After the rally dried up, prices went sideways for nearly an hour. Although they were sideways, they were technically forming an uptrend as prices took off once again up to 470.00. There were close to 800 lots being offered at 470.00, and when buyers were unable to lift those offers, wheat once again went into a sideways direction in a tight 1.5 point range. Wheat started to get choppy coming into the closing period and during the final minutes of closing, prices broke heavy losing nearly 6 points. Wheat settled the day down slightly, but managed to be up for the week and month.

Overall, TFR managed to net 10.75 points in live trading. Slow and steady wins the race. Let’s finish the month up strong. Starting Monday (6/21) corn and wheat will switch over to the September (U) contract and soybeans will switch to the November (X) contracts.

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