Tuesday, June 26, 2012 Corn futures have been one of the hottest markets lately, sparked by hot, dry weather, which could reduce what was previously expected to be a record crop. The next week to two weeks are going to be very important to the health of the Corn crop, so traders will be closely watching weather conditions. Demand has been relatively soft, and wetter conditions in China could slow export demand from the Asian nation.Fundamentals Corn futures have caught fire in recent sessions due to the about-face in weather conditions in the US. The early warmth and good growing conditions of spring have given way to dry, drought-like conditions. The next 10 days are going to be vital for Corn, as intense heat and dry conditions are expected to stress crops. Temperatures are forecast to hit triple-digits across much of the Midwest. Any moisture would offer relief from the parched conditions seen recently. China is expected to see some moisture in the coming days, which should lessen the stress on crops there and take some of the pressure off US growers. The weekly Corn Conditions report showed that only 56% of Corn was rated good/excellent, compared to the 10 year average of 69%. Traders will want to keep an eye on the weather forecast, as a cooler and or wetter shift may slow the bulls' momentum. Weather models have shifted for the eastern Corn Belt, hinting at possible moisture and warm weather, but not extreme, temperatures. The western portion of the Corn Belt is the major concern for traders, as that is the region which is expected to suffer the brunt of the heat wave's extremes.Technical Notes Turning to the chart, we see the December Corn contract taking-out resistance at the 550, 575 and 600 levels. Relative highs around the 615.00 level present the next test for the market. The recent rally has brought about overbought conditions on the RSI, which may slow the rally down. If the market is able to break-out above the 615.00 level, significant resistance at the 675.00 level could be tested. Rob Kurzatkowski, Senior Commodity Analyst
updated Jun 26, 2012
Sign up to get our newsletter with money saving tips, travel hacks and more - no spam.
discounts & deals from all banks in one app?
At GET.com we compare credit cards and rate them objectively based on the credit card's features, interest rates and fees.
Cards are rated by our team based primarily on the basis of value for money to the cardholder. The GET.com team rates each card based on its annual fee, rewards, benefits, bonus, introductory APR, ongoing APR, flexibility (in how its benefits can be used and how rewards are earned and redeemed), and other card features.