Corn Tech Update

Grain Market Commentary

Thursday, January 14, 2021

by Jacob Christy, Senior Merchant, The Andersons

The wild week for corn continues. We’ve had prices go limit up, gap higher, subsequently downside reverse, fill said gap, just to reverse higher again today. All that within three days and with an average daily range of 23c. Like I said, Wild.

As outlined above the last three sessions in corn make for one unique chart. The failure to hold yesterday’s gains followed by the market filling the open chart gap last night were pretty fair warning signs of a looming correction, or at the very least consolidation. However, the big upside swing today is just what the bull wanted to see; a complete lack of follow through selling and a rejection to discounting any of Tuesdays limit up move. From here trade keys on Wednesday’s contract highs.

Though a large range, how the market reacts within this week’s post-report range could be telling. Breaching Wednesday’s high fuels the bullish momentum opening the door for a quick move to 555-560 and beyond. On the flip side taking out the report day high at 517 1/4 would obviously start causing new length to fall underwater and have the market no longer “believing” Tuesdays data.  Both are pretty clear lines in the sand.

As the market violently paradigm shifts following the USDA’s bombshells there’s little the chart can say until a new fair value is found. Given the markets widening average trading range, it feels like there’s a ways to go before we “price-in”. With that and a three-day weekend ahead expect more volatility tomorrow and again Monday night. Stay tuned.

The Andersons Tech Update