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Daily Grain Market Update (4.20.18)

Published on: 12:58PM Apr 20, 2018

CORN (May)

 

Yesterday’s Close:  May corn futures finished the day down 1 cent, trading in a range of 2 ¾ cents for the session.  Funds were estimated sellers of 4,500 contracts.

 

Fundamentals:  Yesterday’s export sales report came in at 1,203,874 metric tons, this was within the expectations from 700,000-1,400,000 metric tons.  Today is May option expiration and we believe that this may have been playing a role in the slow grind lower this week.  We have been pinpointing the 380 strike this week as a possible magnet for the market.  When going into option expiration, strikes with high open interest on both sides (puts and calls) tend to be a magnet.  There are roughly 13,000 puts open here and 20,000 calls; if we close near 380 these will all go (close to) worthless.  Weather continues to be dominating the headlines at the moment, but we have yet to but significant weight on that yet.  It is still very early in planting season to get too worked up.

 

 

Technicals:  With May options going off the board at the close of today’s session, this will be our last day covering May technicals.  We will be shifting our focus to the more active July contract on Monday.  The recent grind lower has taken the wind out of the sails for some of the bulls, but we look at it as an opportunity to buy value (price is what you pay, value is what you get).  We are testing first support this morning and if prices can stabilize to start next week, that should put the market in a good position to make a run back above resistance.  First resistance for the bulls comes in from....Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.

 

SOYBEANS (May)

 

Yesterday’s Close:  May soybean futures finished the day down 8 ½ cents, trading in a range of 12 cents.  Funds were estimated sellers of 5,500 contracts.

 

Fundamentals:  yesterday’s export sales came in at 2,131,448 metric tons, this was on the top end of expectations which were for 1,400,000-2,200,000 metric tons.  Unfortunately, a good export sales number was not enough to offer support to the market in yesterdays session.  The headline news right now is weather and planting delays for corn.  Planting delays for corn could mean some of those acres shift over to beans; more supply, lower prices.  May options go off the board today which may have helped the market work lower yesterday.  Looking at the open interest, it appears that 1040 would be the “magnet” but the light volume overnight/early morning trade suggests otherwise.  We will get a better idea of things when the floor opens up and there is more participation.

 

Technicals:  With May options going off the board at the close of today’s session, this will be our last day covering May technicals.  Prices retreated yesterday and filled the gap that was left from the April 9th open.  Initial price action off of the fill was very constructive but that has faded in the overnight/early morning trade.  We often say that volume confirms price, so we tend to take the after-hours session with a grain of salt.  If the market cannot hold ground through today’s session, it is possible that we start to see funds taking some risk off of the table.  The next significant support pocket doesn’t come in until....Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.

 

 

WHEAT (May)

 

 

Yesterday’s Close:  May wheat futures finished yesterday’s session up 1 ½ cents, trading in a range of 8 ¼ cents.  Funds were estimated buyers of 2,000 contracts.

 

Fundamentals:  Export sales yesterday morning came in at 173,533 metric tons, this was towards the low end of the expected range from 100,000-500,000 metric tons.  The wheat bulls will want to start to see demand picking up to help the cause.  At the moment much of the price action revolves around the KC wheat contract and weather in wheat country.  If it stays dry in areas over the weekend, we would expect to see a gap higher come Sunday night.  If some key areas get moisture, we would expect a gap lower.  It is a tough market right now because you are at the mercy of mother nature. 

 

Technicals:  With May options going off the board at the close of today’s session, this will be our last day covering May technicals.  May wheat futures managed to reclaim the 50 and 200 day moving average yesterday but have given those up in the early morning trade.  The market is testing support which comes in at 467 ¾, this represents a key Fibonacci retarcment level from the recent range.  A close below this level would be the last thing the bulls want to see; the next support pocket comes in from....Please sign up for a Free Trial at Blue Line Futures to view our entire technical outlook and proprietary bias and levels.

 

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