I am Stephen Davis, senior market strategist at Walsh Trading, Inc., Chicago, Illinois. You can reach me at 312-878-2391.
The corn market still has not filled the gap from August 24 at 510.2. Typically, corn is very good at filling these gaps, in my opinion, and this is bullish. The daily chart below for December 2026 corn reveals three days of higher lows.
Stay tuned. Tomorrow is the last day of the month and end of the quarter. And, tomorrow at 12 p.m., the quarterly Grain Stocks report will be released by the United States Department of Agriculture (USDA). The report contains stocks of all wheat, durum wheat, corn, sorghum, oats, barley, soybeans, and other grains by states and U.S. and by position (on-farm or off-farm storage). The number and capacity of off-farm storage facilities and capacity of on-farm storage facilities is included. The numbers could spark volatility up to tomorrow's close, in my opinion..
Demand for U.S. corn is strong and production is lower than expected.
In its Feed Outlook report dated September 15, the USDA Economic Research Service states: “On net, the 2026 U.S. corn production forecast is revised down 213 million bushels this month to 15.8 billion (down 1 percent). Despite the month-to-month decrease and a projected drop of 1.2 billion bushels from last year, the 2026 corn crop remains projected as the second-largest on record.”
Looking back at the monthly USDA World Agricultural Supply and Demand Estimates (WASDE) report on September 11, it states that the "2026/27 U.S. corn outlook is for smaller supplies, lower
domestic use, unchanged exports, and reduced ending stocks." It adds that “exports are unchanged at 3.3 billion bushels despite lower production, reflecting expectations of steady demand.” The next WASDE report is due October 9.
Corn has seen four months of higher highs and higher lows. This is reflected on the monthly chart below. This backing and filling is a buying opportunity, in my opinion.
A trade strategy is to buy December 2026 corn at 517.2 (yesterday's low). Risk the trade to 507.2 stop ($500 risk per contract). Profit objective is 537.0, which is $1,000 profit per contract.
A long-term option trade strategy is to buy March 2027 corn $6 call at 10.0 ($500 per contract). These options expire February 19, 2027. This is plenty of time for corn to get above $6, in my opinion.
To discuss trading strategies, contact me anytime. Have an excellent day.
Stephen Davis
Senior Market Strategist
Walsh Trading
Direct 312 878 2391
Toll Free 800 556 9411
sdavis@walshtrading.com
www.walshtrading.com
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