Phase 1 Signing likely Catalyst for Corn RallyPosted 01/14/2020 11:11AM CT |
Mar ’20 corn futures look to start another day positive showing impressive bullish activity after Fridays somewhat bearish USDA report. From a technical perspective it’s a very bullish indicator when prices hammer down deep taking out several lows and bouncing up to close positive. Corn demonstrated a clear rejection of lower prices and has followed through with more daily gains. The Phase 1 trade agreement between U.S./China is set for tomorrow and could have big implications for corn. It’s possible we may still see corn numbers reduced from such a late planting and all the weather issues this season. However, the biggest factor driving this market higher right now is demand. If the US/China trade deal moves forward there is huge potential for increased demand for corn; whether it’s for human consumption, livestock feed, or production in ethanol. Prices at the time of writing are at a resistance point in the current consolidation range, but the trade agreement is a likely catalyst for a break-out and rally.