Daily Grain Market Update (4.13.18)
Apr 13, 2018
Yesterday’s Close: May corn futures finished the yesterday’s session up 1 ¾ cents, trading in a range of 4 ¼ cents. Funds were estimated buyers of 8,500 contracts.
Fundamentals: Yesterday’s weekly export sales report came in at 895,914 metric tons, this was just shy of the expected range from 900,000-1,700,000 metric tons. Colder than normal temperatures have sparked some talk of potential planting delays, this has helped offer some minor support to the market. We believe that the market could continue to add that premium over the coming weeks but would look to fade that eventually. Farmers love to plant corn and we are confident that they will be able to get in the ground.
Technicals: Not a lot has changed on the technical front as the market is treading water in the middle of our support and resistance pockets. Our first resistance pocket comes in from 391 ¾-395 ¼. We have tested this barrier on numerous occasions which leaves it susceptible to giving way on another test. On the support side of things, we see 379 ¾-382 ¾ as first support. This target represents the 50-day moving average, a key Fibonacci retracement from the July highs to the January lows, along with a handful of other indicators. We feel that a pull back to this pocket would be an opportunity to buy on the first test. If the market cannot get a bounce off of the first test, we could see continued liquidation take us back to....
Yesterday’s Close: May soybean futures finished yesterday’s session up 13 ¼ cents, trading in a range of 14 ½ cents. Funds were estimated buyers of 14,000 contracts.
Fundamentals: Weekly export sales were phenomenal yesterday at 2,464,512 metric tons. This was well above the expected range from 900,000-2,000,000 metric tons. The political jawboning and Argentinian crop have helped spur some of the recent buying. 954,036 of those metric tons were for the 2018/2019 crop which is interesting to note. Soybean meal looks strong and poised for another attempt at a break out above 400; this would be very supportive to beans. Weather in the states will continue to be a big catalyst in the intermediate term. If corn gets delayed, we could see some of those acres shift towards beans.
Technicals: Yesterday’s price action was exactly what the bears were trying to avoid. Near term fundamentals along with price action above our resistance pocket from 1052 ¾-1060 ½ has shifted our bias. We would not be surprised to see this market make a run at the March 2nd highs of 1082 ½. The RSI (relative strength index) is currently at 61.95 which is far from overbought territory. The bears want to see a close back below....
Yesterday’s Close: May wheat futures finished yesterday’s session down 3 ¾ cents, trading in a range of 10 cents. Funds were estimated sellers of 4,500 contracts on the day.
Fundamentals: Weekly export sales yesterday morning came in at 188,701 metric tons, this was on the low end of the expected range from 150,000-650,000 metric tons. Poor demand continues to encourage funds to defend their net short position. The weather premium from the start of the week has all but evaporated as temperatures normalize in some key areas. If we start to see colder/drier weather work itself back into the forecast for wheat country, then we could see the market reclaim some lost ground.
Technicals: The market has continued to pull back in the overnight session, testing our 4-star support pocket from 467 ¾-472 ¾. This is a wider pocket than we would typically like, but it holds a lot of significance in our mind. This pocket represents a key Fibonacci retracement, the 50-day moving average, and the gap from the Sunday night open. We believe this will represent an opportunity on the first test to buy, with the risk reward being more favorable. If the market cannot hold support, there is not a lot of support until....
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