Yesterday’s Close: July corn futures finished the session down ½ of a cent, this after trading in a range of 3 ¼ cents. Funds were estimated buyers of 2,500 contracts on the day.
Fundamentals: Yesterday afternoon the USDA released their weekly plantings report. Corn planting is said to be 62% complete, this was above expectations and is now just slightly behind the 5-year average pace of 63%. Despite the jump in planting progress, the market has found some legs in the overnight and early morning session. Bulls will want to see volume confirm price on the floor open. Weekly export inspections came in at 1,554,495 metric tons, this was within the range of expectations of 1,400,000-1,800,000 metric tons; last weeks inspections were 1,916,000 metric tons.
Technicals: July corn futures held the 50-day average nearly perfect to start the week which keeps our support pocket from 390 ½-394 ½ intact. Higher lows and higher highs have been the trend for the last two months, so long as support holds, we will mark another higher low. We remain bullish on corn and welcome pullbacks as a buying opportunity. 397 ¼ is the pivot point today, if the bulls can achieve a conviction close above this level, we could see the market make a run back towards the top end of the range which comes in from 407-408 ½.
Resistance: 407-408 ½***, 425 ¾-426 ½**
Pivot: 397 ¼
Support: 390 ½-394 ½***, 379 ½-383 ½****
Yesterday’s Close: July soybean futures finished the session up 15 ¾ cents, this after trading in a range of 24 ¼ cents. Funds were estimated to have been buyers of 6,000 contracts.
Fundamentals: July soybeans erased a large portion of Friday’s losses on hopes that the Chinese Vice Minister and President Trump will make progress in trade negotiations this week in Washington; what comes of this meeting could set the tone for the remainder of the year. The USDA released their weekly planting progress report yesterday afternoon. Soybeans are said to be 35% planted, this was above expectations and above the 5-year average pace of 26%. Weekly export inspections came in at 688,195 metric tons which was above the expectations of 450,000-650,000 metric tons. Last week’s inspections came in at 535,000 metric tons. We continue to keep a close eye on the soybean meal market as it will likely have a strong influence on soybean price action.
Technicals: Yesterday morning we were on RFD-TV discussing a big technical barrier at 1027, that was tested and held yesterday with the high coming in at 1026. The 3-star resistance level from 1026 ½-1028 ¼ remains intact for today’s session. So long as the bears can defend this pocket on a closing basis, they will remain in control. Lower lows and lower highs has been the trend which has kept the bears in control over the past few months. A break and close back below 1013-1016 opens the door for a breakdown below the psychologically significant $10.00 handle. The next significant support pocket comes in from 988 ¾-994 ¾. This pocket represents a key retracement along with the lows from the original “tariff talk” scare on April 4th.
Resistance: 1026 ½-1028 ¼***, 1040-1042 ½**
Support: 1013-1016***, 988 ¾-994 ¾****, 965 ¼-969 ½***
Yesterday’s Close: July wheat futures finished the day down 6 cents, this after trading in a range of 8 ¾ cents. Funds were estimated to have been sellers of 4,000 contracts on the session.
Fundamentals: The market has struggled to find new bullish news to stoke positive momentum; the lack of new news has led to a breakdown over the last week (see technicals below). The USDA released their weekly crop progress report yesterday which showed the spring wheat crop is 58% planted, this was above expectations but still lags the 5-year average of 67%. The winter wheat crop rating came in at 36% good/excellent, this compares to analyst estimates of 34%. Weekly export inspections came in at 404,180 metric tons, this was within the range of expectations from 250,000-500,000 metric tons. Last week’s inspections came in at 332,000 metric tons. We continue to keep a closes eye on the KC contract as it will have an influence on price action.
Technicals: The market has been bleeding lower for the better part of the last two weeks. The breakdown below technical levels have led the selling to feed on itself and we are expecting that to continue in the near term. We see significant support in the market from 477 ½-482 ¾, this represents a key retracement on the years range, along with the 100 and 200 day moving average. At this point, we would not be surprised to see a relief rally. So, if you are short this is where we would encourage you to cover some if not all, and if you are bullish this is an area to look for a short-term bounce.
Resistance: 499-502 ¾***, 523-524**, 543 ½-545***
Support: 477 ½-482 ¾****, 467 ¾**, 458 ¾-463***
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Futures trading involves substantial risk of loss and may not be suitable for all investors. Trading advice is based on information taken from trade and statistical services and other sources Blue Line Futures, LLC believes are reliable. We do not guarantee that such information is accurate or complete and it should not be relied upon as such. Trading advice reflects our good faith judgment at a specific time and is subject to change without notice. There is no guarantee that the advice we give will result in profitable trades. All trading decisions will be made by the account holder. Past performance is not necessarily indicative of future results.